Canara Bank Dairy Loans - Supporting Dairy Farming Ventures

Construction of cattle shed
Purchase of high yielding milch cattle (yielding not less than 5 litres per day)
Purchase of dairy equipments, cattle feed and for cultivation of green fodder.
Expenditure incurred for transportation of animals where the animals are not purchased locally.
Initial feed cost for a period of 1 month at the rate of 120 kgs. per animal for the first batch of animals.
Setting up of on farm processing and pasteurization plants.
Loans can be extended for purchase of Crossbred heifer and/or for its rearing till it reaches lactation period.
Known cattle breeders and technically qualified entrepreneurs can be financed for purchase of non descript cows for getting crossbred progeny and for its rearing upto maturity or till it is sold, whichever is earlier.

Farmers, Individual entrepreneurs, NGOs, companies, groups of unorganized and organized sector etc. Groups of organized sector include Self Help Groups (SHGs), Dairy cooperative societies, milk unions, milk federations etc.
The farmer should have cattle shed/arrangements enough to house the existing animals if any and also those proposed to be purchased.
The farmer should be cultivating green fodder or should have definite arrangements for its supply.
Drinking water should be available in the area.
Veterinary facilities should be readily and easily available including facility for artificial insemination.
The farmer should have experience/ knowledge in maintaining dairy animals.
There should be assured marketing facilities.
Artificial insemination facilities should be available within easy reach.
The Heifer should be of good breed and in good health.

Margin

Up to Rs.1.60 lakhs - Nil
Above Rs.1.60 lakhs -15-25%

Security

Loan Quantum	Security to be stipulated
For loan upto Rs. 1,60,000/- & For Loans above Rs. 1,60,000/-and upto Rs.3,00,000/- wherein Tripartite agreement with Milk Union is available:	Hypothecation of assets created out of our finance. Compulsory coverage for Credit Guarantee under CGFMU.
For Loans above Rs. 1,60,000/-and upto Rs.3,00,000/ wherein Tripartite agreement with Milk Union is NOT available: & For Loans above Rs. 300,000/-and up to Rs.10,00,000/-	Hypothecation of assets created out of our finance. Compulsory coverage for credit Guarantee under CGFMU. In case of developmental activities like construction of cattle shed, fish pond, poultry shed, or creation of any other immovable assets, mortgage of land where primary activities are undertaken and connected with the activity is to be taken. If the developments are undertaken on the leased land and where legislation permits mortgage of lease hold rights: Mortgage of leased hold right may be insisted Compulsory coverage for credit Guarantee under CGFMU. Mortgage of leased hold right may be insisted Compulsory coverage for credit Guarantee under CGFMU. If the lease hold rights are not mortgaged, collateral security with minimum value of 150% of the loan amount to be insisted. In such cases, the coverage under CGFMU to be waived subject to obtaining permission from the RO Head.
For loans above Rs.10,00,000/-	Hypothecation of assets created out of our finance. In case of developmental activities like construction of cattle shed, fish pond, poultry shed, or creation of any other immovable assets - mortgage of land where primary activities are undertaken and connected with the activity is to be taken. If the developments are undertaken on the leased land and where legislation permits mortgage of lease hold rights, Mortgage of leased hold right may be insisted. If leasehold rights are mortgaged, Immovable security should be obtained, value of which should be a minimum 50% of the loan amount. If leasehold rights are not mortgaged, Immovable or equivalent Collateral security should be obtained, value of which should be a minimum 150% of the loan amount, wherein at least 50% security by way of Residential/ Commercial Properties (Land & Buildings backed by approved building plan). Availability of security by way immovable property/ies secured by mortgage to a minimum extent of 100% of the loan/exposure as Prime and collateral securities.

Repayment Period

Loans granted for purchase of dairy animals should be recovered in a period of 5-7 years in suitable monthly/quarterly instalments.
When the loan is granted for rearing of heifers for ultimate production of milk, the loan may be recovered within a period of 5-6 years including initial grace period of 30 months.

Moratorium: Project involving Shed Construction, pasteurization etc, 12-18 months may be stipulated on case to case basis, else1-2 months
Gestation Period: Should be linked with Lactation period to cover dry period of the animal (generally 6 months gap shall be provided for introduction of animals in batches to ensure continuity of milk production )