Centre asks PSBs, IBA to standardise contract-farming loans in 6-12 months

The second person said lending decisions would be based on the reliability of the buyer’s purchase agreement, rather than collateral. The proposed framework would include a model tripartite agreement among the farmer, sponsor, and bank, a uniform set of loan terms, and standard rules for handling quality rejections and price changes. Mint’s queries emailed to the IBA, 12 PSBs, National Bank for Agriculture and Rural Development (NABARD) and ministries of agriculture and farmers welfare and rural development on 18 August evening remained unanswered. Other proposals The government has also proposed that the IBA and NABARD explore Credit Guarantee Fund Trust…