Agri Infrastructure Fund Scheme: Application Process, Benefits, and Essential Tips

The Agri Infrastructure Fund (AIF) scheme is a powerful financial tool to help farmers and agribusinesses enhance productivity through infrastructure development. If you’re planning to invest in agricultural infrastructure and seek financial assistance, the AIF scheme could be a perfect match. This guide will take you through each step needed to apply and gain the full benefits of the scheme.

Step 1: Secure a Bank Loan through the AIF Route

One of the first actions required to utilize the AIF scheme is obtaining a bank loan. The AIF scheme provides easy access to credit for eligible agribusinesses, covering various activities such as warehousing, cold storage, and other types of agri-infrastructure. The list of eligible businesses and the benefits provided are well-defined under the scheme, making it easier for applicants to see if they qualify.

Who Can Apply?

Farmers, Farmer Producer Organizations (FPOs), Primary Agricultural Credit Societies (PACS)
Agri-entrepreneurs, startups, central/state agencies, and other eligible agribusinesses

By verifying your eligibility, you can start the application process and be better prepared to take the next steps.

Step 2: Prepare for the Application Process

The application process for the AIF scheme requires careful preparation to ensure that you submit a complete and accurate application. The goal here is to present a project report that aligns with both the AIF scheme’s requirements and your bank’s lending criteria.

Key Components:

Develop a Project Report
Your project report is essential and should clearly outline the proposed infrastructure project, financial projections, and expected benefits. The report should meet both AIF guidelines and the bank’s criteria for loan approval.
Preliminary Discussion with the Bank
Before applying, engage in a preliminary discussion with your preferred bank. Verify that your project is classified under priority sector lending, as this will strengthen your eligibility for the AIF scheme.
Submit Your Application to the Ministry of Agriculture
Once your project report is complete and you’ve confirmed it meets the bank’s requirements, submit the report to the Ministry of Agriculture. This step is essential to ensure that you qualify for AIF benefits.

Step 3: Get Approval under the Agri Infra Financial Facility

After submitting your application, the Ministry of Agriculture’s Department of Agriculture and Farmers Welfare will assess your project. They have established Project Management Units (PMUs) to review and approve projects within 15 to 30 days.

PMU Evaluation:

The PMUs review your project proposal, ensuring it aligns with AIF standards.
Approval is forwarded to the bank branch specified in your application.

Important Note: Include detailed bank information, including branch address, in your application to facilitate coordination between the AIF and your bank.

Once your project is approved, the Ministry will forward the approval to your designated bank branch, and the AIF portal will sync with the bank’s loan system. The portal will then display loan details, including approval, disbursement, installment status, and interest subsidy.

Step 4: Claiming Interest Subsidies and Credit Guarantee Cover

Once your project is approved and the loan is disbursed, you can benefit from interest subsidies and credit guarantee cover fees under the AIF scheme.

Interest Subsidy Claims by the Bank

The bank submits interest subsidy claims on your behalf to the Ministry of Agriculture on a quarterly basis.
The Standard Operating Procedures (SOPs) set by the Ministry govern the claim process, and no additional steps are required from you to receive these benefits.

Collateral-Free Relaxation Benefits:

If you are eligible for collateral-free loans, the bank will also claim the credit guarantee cover fees, and these funds will be reflected in your account.

Monitoring and Compliance

To ensure transparency, the Ministry of Agriculture conducts physical inspections of units receiving AIF benefits. During these inspections, they verify that funds are being used as intended and that projects align with the AIF’s objectives.

Compliance Tip: Make sure your accounts and project details are accurate and up-to-date to avoid any issues. False claims or discrepancies can lead to penalties and the requirement to return interest subsidies.

Summary

To benefit from the AIF scheme, follow these steps:

Obtain a Bank Loan by verifying your eligibility and preparing a project report.
Submit Your Application to the Ministry of Agriculture.
Get Approval within 15 to 30 days, with your project synced to the AIF portal.
Enjoy Interest Subsidies and Credit Guarantee Benefits, managed by the bank on a quarterly basis.
Ensure Compliance to maintain your eligibility and avoid penalties.

By following these steps, you can unlock the full benefits of the Agri Infrastructure Fund scheme, making it easier to finance and develop agricultural infrastructure for a sustainable future.

Reach Us

Call Us: 8683898080

E-mail Us: sales@kipfinancial.com

KIP Financial Consultancy Pvt. Ltd.

DSB – 38, Red Square Market, Hisar – 125001 (HR)