The Hindu : Business : HDFC Bank, NAFED join hands

Online edition of India's National Newspaper
Tuesday, Feb 08, 2005

Business

Business

HDFC Bank, NAFED join hands

By Our Special Correspondent

NEW DELHI, FEB. 7. The National Agricultural Cooperative Marketing Federation (NAFED) and HDFC Bank have entered into an agreement to provide finance to farmers and cooperatives associated with the agri-marketing federation.

This arrangement will help prevent them from making distress sale of their farm produce.

The main objective of the two joining hands is to provide this section with an option to arrange sale at an opportune time so that their business interests are looked after.

As per the arrangement worked out, HDFC Bank will extend loans to farmers at competitive market rates of interest while NAFED is to play the role of a facilitator.

The federation will not only disseminate market intelligence but also help farmers in arranging the sale of their produce at the best possible prices.

Under the funding scheme, according to a HDFC Bank statement here, immediate financing to the extent of a maximum of 70 per cent of the requirement is to be extended to the farmers against the deposit of agricultural stock with designated warehouses.

The farmers will be free to sell the stock at any time during six months from the date of deposit of such stock.

The scheme will be formally launched during the rabi season of the current year.

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