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Classification Of Agricultural Credit
   
Tenor
 
  • Size of loan and category of borrower
  • Type of project or scheme
  • Type of financing
    • Credit
      • Loan
      • OverDraft
    • Guarantee
    • Joint ventureship or equity participation
 The tenor of agricultural loans granted by ADB depends on the project type and thereby on such features as the cash flow, capital outlay and project maturity.
Based on the expected life of the project or activity the credit may be classified into three as follows
   
 Short-term loan
   Typically granted as working capital to meet production ,transportation and marketing of agricultural produce for up to 18 months(1 ½ years)
   
 Medium-term loan
   Granted for such purposes as the purchase of farm equipment, livestock and other allied enterprises for between 18 to 36 months and between 18 months and 3 years.
   
 Long-term loan
 

 Made for new and existing projects which require heavy capital outlay and / or long gestation periods, such as the establishment of plantations or cattle ranches etc.

Small-scale individual credit - The credit is granted in the personal name of the individual concerned for a viable agricultural activity.

Small-scale group loan - The credit is granted collectively to a group of people involved in a common activity. The group executives individually and severally guarantee the loan.

   
Scale & Beneficiary
   
 Medium-scale / Large-scale - Business loan/overdraft advance
   Credit is made available to medium-to-large-scale business concerns for agricultural-related operation.
   
 Special project financing
   The bank provides credit by participating in the project on equity basis.