The National Bank for Agriculture and Rural Development (NABARD) on September 25, 2026, issued circular on Provision of short-term refinance for financing Seasonal Agricultural Operations - Financing of PACS/Ceded Societies through Scheduled Commercial Banks -2026-27.
NABARD provides short-term refinance assistance to Scheduled Commercial Banks against credit extended to Primary Agricultural Credit Societies (PACS) for financing seasonal agricultural operations in areas where Central Cooperative Banks are weak or unable to provide adequate lending support. The credit limits are sanctioned under Sections 21(1) and 21(4) of the NABARD Act, 1981, against promissory notes and subject to the banks furnishing the required declarations regarding the purposes of loans and advances. Scheduled Commercial Banks, in turn, provide credit limits to PACS for onward lending to their members.
The refinance amount is capped at 40% of the Realistic Lending Programme (RLP) of the Scheduled Commercial Bank for the identified PACS, based on the assessment of anticipated crop loan disbursements. The current refinance interest rate is 4.5% per annum, subject to revision, while the interest rate charged to ultimate borrowers on crop loans up to ₹3 lakh must not exceed 7% per annum. The applicable policy guidelines, eligibility criteria, terms and conditions are specified in Annexures I and II. The operational guidelines are effective from April 1 of the current financial year.
[Circular No. 231/DoR-73/2026]
