UP Farmers Loan at 6% Interest Rate
Big Relief for Farmers in Uttar Pradesh: Loans at Just 6% Interest – Complete Details, Application Process & Required Documents
In a major relief for farmers, the Uttar Pradesh government has announced a historic decision that will significantly reduce the financial burden on the farming community. At a time when the cost of agriculture is continuously rising-due to expensive seeds, fertilizers, diesel, irrigation, machinery, and labor – the state government has introduced low-interest loans at just 6% for farmers.
This benefit is being provided under the Mukhyamantri Krishak Samriddhi Yojana, especially aimed at small and marginal farmers. Earlier, farmers had to pay interest ranging between 11% and 11.5%, which often became a heavy burden. The reduction in interest rates will now help farmers invest confidently in agriculture and allied activities without falling into a debt trap.
The announcement was made by Uttar Pradesh Chief Minister Yogi Adityanath at a program held in Lucknow on 21 December 2025, just before the end of the year-making it a timely New Year gift for farmers across the state.
This article explains everything in detail:
- What is Mukhyamantri Krishak Samriddhi Yojana
- Who is eligible for the loan
- Interest rate benefits
- Loan duration
- Purposes for which loans can be taken
- Step-by-step application process
- Contribution and administrative charges
- Required documents
- Special benefits for women farmers
Why Low-Interest Loans Are Crucial for Farmers
Agriculture is considered the backbone of India’s economy, and Uttar Pradesh is the country’s largest agrarian state. A major portion of the population depends on farming and allied activities for livelihood. However, over the years, farming has become increasingly expensive.
Costs related to seeds, fertilizers, pesticides, irrigation systems, tractors, farm machinery, dairy farming, livestock, and fisheries have gone up significantly. In such conditions, high-interest loans often force farmers into a cycle of debt. To address this problem and reduce dependence on private moneylenders, the Uttar Pradesh government has taken this farmer-friendly step.
What Is Mukhyamantri Krishak Samriddhi Yojana?
Mukhyamantri Krishak Samriddhi Yojana is a flagship scheme of the Uttar Pradesh government designed to provide affordable institutional credit to farmers. Under this scheme, farmers can avail loans at subsidized interest rates for agriculture and various allied activities.
Loans under this scheme are provided through UP Cooperative Gramin Vikas Bank Limited, ensuring transparency, security, and ease of access for farmers.
Farmers can get information or apply by visiting the nearest cooperative bank branch or the official website.
Major Reduction in Interest Rates
Earlier, under this scheme, farmers were required to pay:
- 11% interest for some agriculture-related activities
- 11.5% interest for others
Now, the Uttar Pradesh government has reduced the interest rate to only 6%, offering huge financial relief.
Key Benefits of Reduced Interest Rate
- Lower EMI and repayment burden
- Easier loan repayment
- Increased investment in farming
- Reduced dependence on private lenders
- Improved financial stability for farmers
This decision is particularly beneficial for small and marginal farmers who often struggle with high-interest loans.
Loan Duration: Up to 15 Years
Farmers can avail loans for a period ranging from 3 years to 15 years. This long repayment period allows farmers to manage cash flow efficiently and repay loans comfortably over time.
Purposes for Which Loans Are Available
UP Cooperative Gramin Vikas Bank Limited provides loans for multiple agriculture and rural development activities. Farmers must be registered and possess a valid Farmer ID to avail benefits.
Loans can be taken for the following purposes:
- Minor irrigation projects
- SRTO-related agricultural works
- Agricultural mechanization (tractors, equipment, tools)
- Beekeeping
- Dairy farming
- Livestock rearing
- Poultry farming
- Fisheries
- Horticulture (fruits and vegetables)
- Rural housing
- Dunlop cart
- Non-agricultural rural development activities
Previously, interest rates for these activities ranged from 11% to 11.5%, which have now been reduced to 6%.
Special Benefit for Women Farmers
To promote women empowerment in agriculture, the government has introduced an additional incentive:
👉 Women farmers will get an extra 1% interest rebate.
This means women farmers will receive loans at an even lower effective interest rate, encouraging their participation in farming and rural entrepreneurship.
Step-by-Step Application Process
STEP 1: Purchase and Submit Application Form
- Visit the nearest Cooperative Bank branch
- Purchase the loan application form for ₹200
- Paste the farmer’s photograph on the form
- Fill in all required details carefully
- Attach the latest Khatauni/Khasra (land records) and other necessary documents
- Submit the form at the bank branch
- Pay ₹3 as membership fee
- Deposit ₹100 as advance share contribution
STEP 2: Verification and Loan Approval
- Bank officials verify the application and documents
- Project appraisal is conducted
- If found eligible, the loan amount is approved
- A Loan Sanction Order (LSO) is issued
Contribution and Administrative Charges
Share Contribution
- Small and Marginal Farmers:
- 5% of the loan amount
- Other Farmers:
- 6% of the loan amount
Example:
If a farmer applies for a loan of ₹1,00,000:
- Small/marginal farmer needs to deposit ₹5,000
Administrative Charges
- Small and marginal farmers:
- 0.5% of loan amount or ₹1,000 (whichever is lower)
- Other farmers:
- 1% of loan amount or ₹2,000 (whichever is lower)
Additionally, two guarantors are mandatory for loan approval.
Documents Required for Loan Application
Farmers must submit the following documents:
- Duly filled application form
- Current crop year Khasra/Khatauni or Farmer Ledger
- Two latest passport-size photographs
- Aadhaar Card
- Ration Card
- KYC Form (available at bank branch)
👉 Important: Loans can be availed not only against agricultural land but also against other buildings, land, or shops, subject to eligibility.
Why This Scheme Is a Game-Changer for Farmers
- Very low interest rate (6%)
- Long repayment period (up to 15 years)
- Encourages investment in farming and allied sectors
- Financial empowerment of small and marginal farmers
- Additional benefits for women farmers
- Strengthens rural economy and livelihoods
This scheme is expected to benefit lakhs of farmers across Uttar Pradesh and significantly boost agricultural productivity.
Conclusion
The decision to reduce the loan interest rate under Mukhyamantri Krishak Samriddhi Yojana to just 6% is being seen as one of the most farmer-friendly initiatives by the Uttar Pradesh government. It provides much-needed financial relief at a crucial time and empowers farmers to invest confidently in agriculture, livestock, dairy, and other rural enterprises.
If you are a farmer in Uttar Pradesh looking for affordable credit, this scheme offers a golden opportunity. Apply on time, complete the documentation properly, and take full advantage of this government initiative to secure a stable and prosperous future.
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