UP Farmers Can Get Up to ₹6 Lakh Agricultural Loan at 6% Interest Under New Scheme

Key Highlights

• Loans of up to ₹6 lakh available for eligible small and marginal farmers.

• Concessional annual interest rate fixed at 6%.

• Government to provide a 5% interest subsidy for timely repayments.

• ₹384 crore approved for the scheme from 2026-27 to 2030-31.

• Scheme targets benefits for around 92% of farming families in Uttar Pradesh.

The Uttar Pradesh government has approved a major financial support scheme for small and marginal farmers, offering long-term agricultural loans of up to ₹6 lakh at a concessional interest rate of 6%. Under the Mukhyamantri Krishak Samriddhi Yojana, the state government will provide a 5% interest subsidy to eligible farmers who repay their loan installments on time. The scheme is aimed at helping farmers make long-term investments in agriculture, create productive assets, improve farm productivity and increase income. The government has also approved ₹384 crore in financial assistance for implementing the scheme.

₹6 Lakh Loan at 6% Interest for Farmers

The scheme was approved during a cabinet meeting chaired by Uttar Pradesh Chief Minister Yogi Adityanath on September 15, 2026. Under the approved plan, eligible small and marginal farmers can access long-term agricultural loans of up to ₹6 lakh at an annual interest rate of 6%.

The scheme is designed to make long-term agricultural finance more affordable. At present, the Uttar Pradesh Cooperative Gram Vikas Bank Limited receives refinance from NABARD at a relatively higher interest rate, resulting in agricultural loans being available to farmers at around 11% to 11.50%.

With government support through the new scheme, the applicable interest rate for eligible farmers will be brought down to 6%.

5% Interest Subsidy Linked to Timely Repayment

A key feature of the Mukhyamantri Krishak Samriddhi Yojana is the 5% interest subsidy offered by the state government.

However, the subsidy is not automatic for every borrower. Farmers must pay their loan installments within the prescribed due dates and meet the scheme's conditions to receive the interest subsidy.

This timely repayment requirement is intended to provide interest relief while encouraging farmers to maintain regular repayment of their agricultural loans.

Scheme Aims to Cover 92% of Farming Families

According to the Uttar Pradesh government, small and marginal farmers account for approximately 92% of the state's farming families. The scheme is therefore intended to reach a large section of the farming community.

The loans are focused on long-term capital investment and asset creation rather than only meeting seasonal cultivation expenses. Farmers can use the financing for investments related to agriculture and agriculture-based activities that can support higher productivity and income over time.

Loans Can Support Agriculture-Based Businesses

The scheme goes beyond conventional farming requirements. The government intends to encourage farmers to invest in agriculture-related activities and small rural businesses.

Affordable long-term finance can help farmers create agricultural assets while also supporting agriculture-based small industries and other business activities in rural areas. The broader objective is to promote self-employment and generate additional employment opportunities at the local level.

₹384 Crore Approved for the Scheme

The Uttar Pradesh government has approved ₹384 crore in financial assistance for the Uttar Pradesh Cooperative Gram Vikas Bank Limited for implementing the scheme.

The financial assistance will be provided during the 2026-27 to 2030-31 financial years. A major portion will support the interest subsidy on farmers' long-term loans.

The approved amount will also support the modernisation and branding of bank branches. Interest subsidy provisions have been planned for five years, while two years have been allocated for branch modernisation and branding during 2026-27 and 2027-28.

For the financial year 2026-27, the state budget has allocated ₹38 crore for the scheme.

Scheme Announced in December 2025

The Mukhyamantri Krishak Samriddhi Yojana was originally announced by Chief Minister Yogi Adityanath on December 21, 2025, during the Cooperative Department's Youth Cooperative Conference and UP Cooperative Expo-2025.

Following approval from the Council of Ministers on September 15, 2026, the scheme can now move towards implementation.

What Farmers Need to Know

Eligible small and marginal farmers will be able to seek long-term agricultural loans of up to ₹6 lakh at a 6% annual interest rate under the scheme. The state government's 5% interest subsidy will be available subject to timely repayment and other prescribed conditions.

The financing is intended for long-term investment and asset creation in agriculture and agriculture-based activities. This could include investments that strengthen farming operations as well as activities that support rural businesses, self-employment and employment generation.

In addition to making agricultural credit more affordable, the government expects the scheme to support productivity and income growth among small and marginal farming families across Uttar Pradesh.

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CMV360 Says

The Mukhyamantri Krishak Samriddhi Yojana provides a new financing route for small and marginal farmers in Uttar Pradesh seeking long-term agricultural investment. Loans of up to ₹6 lakh at 6% interest, along with a conditional 5% subsidy, can reduce borrowing costs for eligible farmers. With ₹384 crore approved, the scheme also aims to support asset creation, rural businesses, self-employment and higher agricultural productivity.