SBI’s Finance for PM KUSUM Scheme: Empowering the Agricultural Sector

State Bank of India (SBI) continues its commitment to sustainable energy and the Indian farming community through its financial support for the Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM KUSUM) scheme. The Component C of the PM KUSUM scheme aims at solarisation of 10 lakh grid-connected agricultural pumps on a pilot basis for one lakh grid-connected agriculture pumps. The scheme is set to scale up with necessary modifications based on learnings from the pilot phase.

Scheme Features

The scheme provides an Agricultural Term Loan with no minimum or maximum loan ceiling. The farmer’s contribution is set at 10% of the benchmark cost of the pump.

The Central Financial Assistance (CFA) structure is defined as follows:

For most states, the State Government’s contribution is 30% and the farmer’s contribution is 40% (including 10% initial payment by the farmer and 30% financed by the bank).

For the North Eastern States, Sikkim, J & K, Himachal Pradesh, Uttarakhand, Lakshadweep, and Andaman & Nicobar Islands, the State Government’s contribution is 30%, while the farmer’s contribution is 20% (including 10% initial payment by the farmer and 30% financed by the bank).

The loan’s security follows the bank’s extant guidelines. The repayment period extends up to 120 months, including a moratorium. The interest rate for the loan is set at 1-Year MCLR + 350 bps, and an upfront fee of 1.40% of the loan amount plus GST is applicable.

The subsidy is back-ended and credit linked, deposited in the form of a Time Deposit Receipt (TDR) with zero interest rate and kept with the branch. The subsidy has a lock-in period of three years.

For more details, visit the official portal at PM KUSUM, or visit the nearest SBI branch.

Summary Table