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Gold Loan For Agriculture Purposes

 

There are many reasons for which our farmers face a lot of problems financially and in other ways also due to the Gold Loan facility and the special schemes only for them. It is good to see where the agricultural land and nation like India all these steps are being taken.

 

Few important facts are of utmost importance to know before availing of the agricultural gold loan. They are-

 

Amount of loan

The loan amount may vary from situation to situation. For example, a person or a small-scale agricultural need will require less capital as compared to the large farms and industries. There might be small needs for pesticides or fertilizers in the small field production of the crops like vegetable growth. On another side of the coin, there is a maximum limit of Rs ten crores for large-scale needs and production of the crops like that for big farms.

 

Rate of interest

While availing of the gold loan there must be some pre-checks that need to be done before availing any loans from the service provider. A better comparison of the interest rates will provide a great deal for the farmers so that much savings can be done. In the meantime normally all the banks and the financial institution provides loan from the seven percent onwards. For example, the Bank of Baroda Gold Loan is a good option.

 

Payment

There are payment options which are very flexible and are as per the requirement of the farmers. There is the availability of the payments option as some are small earners or might be stepping forward for getting part-wise profit on the sale of their crops. Through that, a profit part from it can be paid as interest. So the EMI option has been kept where the interest, as well as the principal, is added in total, and then the installment is divided equally in monthly installments. On the other side of the coin if we talk about the larger farm owners after selling their huge produce might be having a good huge lump sum amount which will be easier for them to repay the loan in another form of option that is called the lump sum.

 

Quality

The gold valuation done by the banks and the financial institutions is very genuine. The gold in the form of ornaments or coins is acceptable. Their quality and the quantity both are accessed. These are done to safeguard the loan borrowers so that they can get back the same gold that they are keeping now. If the gold is not valued properly then it might happen that there will be a discrepancy while settling the repayment of the loan and thus even the credit score of the borrower can get a hit without any valid reason.

 

Time

The agricultural gold loans are typically given for a period of a maximum of twenty-four months. This has been done for those who have very few sources of money but can pay after the good crops are being sold in the market. While on the other side of the coin the minimum time is one month which is required for a short-term basis like making changes in the tractors, field equipment, etc.

 

Fees

The fees are charged based on the priority that is why the processing fees of the loan have been kept minimum that is from zero to one percent of the loan amount.

 

Conclusion: So these were the main things that should be looked upon while going for the agricultural gold loan. The proper management and the proper plans should be implemented to not fall prey to a negative impact on credit score.

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