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What do you mean by Agricultural Finance?

Updated on 20 February 2021
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Bcom Exam Guide
7 min read 36 views
Updated on 20 February 2021


Agriculture Finance is a kind of a financial service which includes supporting both on and off agricultural activities. This also includes businesses like distributor, intermediate, wholesaler, processor and marketer. Agricultural Finance is a course including financing and other services provided to the farmers who take loans. Easy loans are available to the farmers who wish to buy land, fertilizers, and other transport machinery. There are different types of Agricultural Finance like Vehicle Finance, Instalment Finance, Asset Finance, Emerging Farmer Finance and many more. These finances or loan services makes it very easy for the farmers to begin with farming and agriculture. There is a lot of scope of agricultural finance. 


People wonder whether there is some scope of agricultural finance or not. Well, before going for a course like this, you need to be aware about the course, its scope and its importance. BSc is one course which is offered in both private and government universities. This course helps the students to learn new techniques of agriculture. The number of students who wish to know about farming and agriculture is increasing day-by-day. BSc is a four-year program. This course includes subjects like agronomy, horticulture, plant breeding, genetics, agriculture economics, basics of biotechnology and many more. After the student has completed the course he/she is offered with various job opportunities. Some of the job roles are given below:


  1. Extension Officer
  2. Agriculture Officer
  3. Plantation Manager
  4. Business Development Manager
  5. Production Manager


These are some of the job roles that you can be recruited in. There are other jobs as well.



Significance of Agricultural Finance


Many people do not know that agricultural finance is an important aspect and every student must know a thing or two about agricultural finance. To know about such financial services, you need to first know about the significance of agricultural finance.


  1. This course is studied at both micro and macro level thereby including subjects like horticulture, plant breeding and many others.
  2. Agricultural Finance leads to the agro-socio-economic development in the country.
  3. These financial services provide easy loans to the farmers which help them in buying new vehicles and other inputs thereby increasing the productivity.
  4. Agricultural finance helps the farmers to strengthen their business. 
  5. The farmers can begin their businesses with easy loans and EMIs.
  6. These services have helped the farmers in attaining a good standard of living thereby investing in agricultural products and other inputs. 


Agricultural Finance in India


Agricultural Finance in India is a study of providing financial services to the farmers who wish to begin their businesses by having updated technology and other sources. There are sources of agricultural credit. Agricultural credit is defined as the service through which young and aspiring farmers can take loans to begin their agricultural business. They are broadly classified into Institutional and Non – Institutional sources. Non – Institutional sources include traders and moneylenders. On the other hand, Institutional sources include the firms which provide easy loans on machinery and fertilizers. There are types of credit provided to the farmers. 


Short – Term Credit:


This includes buying fertilizers or seeds which are necessary for agriculture. The period varies from 5 – 10 months. These loans are repaid after the harvest.


Medium – Term Credit:


The period for this credit ranges from 10 months to 2 years. This credit includes investment in equipment like hand pumps, cattle and other irrigation machinery. 


Long – Term Credit:


The duration of this credit is up to five years. This credit includes buying land or transport vehicles like tractors, building wells etc. farmers can take such easy loans and repay with a small amount of interest and low EMIs. 


Agriculture finance has its own importance in India. Students who wish to study agriculture can apply for BSc and MSc courses. There is a lot of scope for agricultural finance as this course is in demand among the students. To apply for the course and having job roles for the same, you need to know the significance and meaning of the course you are applying for. Therefore, agriculture finance is a good career option for the ones who wish to pursue this course.


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