Agriculture Infrastructure Fund 2026: 3% Subvention Loan

The Agriculture Infrastructure Fund (AIF) is a central scheme that cuts the interest cost of loans for farm-gate and post-harvest infrastructure, such as warehouses, cold storages, sorting and grading units and primary processing. The government pays 3% a year of the interest on loans up to ₹2 crore per project for up to seven years, lenders cannot charge more than 9% on that portion, and the credit guarantee fee is paid by the government so no collateral is needed up to ₹2 crore. You apply online at agriinfra.dac.gov.in and the application goes to the bank you choose.

All terms below are as of October 2026.

Status in 2026

AIF was launched in July 2020 with a ₹1 lakh crore financing facility. The scheme runs from 2020-21 to 2032-33, but new loans were to be disbursed within six years, that is, by 2025-26. As of 24 October 2026, the AIF portal shows ₹1,02,640 crore sanctioned for 2,28,428 projects.

The window has been kept open. A Finance Ministry office memorandum in March 2026 temporarily continued AIF beyond 31 March 2026, and a Department of Agriculture memorandum dated 30 September 2026 extended it up to 31 March 2027 or until the scheme is approved for the 16th Finance Commission period, whichever is earlier, with existing terms unchanged. The Union Budget 2026-27 also allocated ₹910 crore to AIF, and the department ran a campaign in June-July 2026 inviting applications. Because the extension is temporary, ask your bank whether it is still sanctioning new AIF loans before you spend on a project report.

Key benefits

There is no minimum or maximum loan size. If a loan is above ₹2 crore, the subvention and guarantee apply only to ₹2 crore and the bank prices the rest at market rates.

Who is eligible

The portal lists: farmers, Farmer Producer Organisations (FPOs) and their federations, Primary Agricultural Credit Societies (PACS), marketing and multipurpose co-operative societies, national and state federations of co-operatives, Self-Help Groups and their federations, Joint Liability Groups, agri-entrepreneurs, start-ups, Agricultural Produce Market Committees (APMCs), state agencies, and PPP projects sponsored by central, state or local bodies.

A private borrower such as a farmer, agri-entrepreneur or start-up can get the benefit on up to 25 projects, each in a different village or town with its own Local Government Directory code. That cap does not apply to state agencies and federations.

Eligible projects

• Post-harvest management: warehouses and silos, cold stores and cold chain, pack-houses, sorting and grading units, assaying units, ripening chambers, reefer and insulated vans, e-marketing and supply chain platforms, and farm waste management.
• Primary processing, and since 29 August 2024, integrated primary and secondary processing. Standalone secondary processing (for example, a biscuit unit without primary milling) is not eligible.
• Viable farming assets, such as custom hiring centres (at least four machines), organic input and bio-stimulant units, nurseries, tissue culture, seed processing, drones and precision-farming sensors, polyhouses, mushroom and hydroponic farming, and honey or sericulture processing. Tractors and some logistics vehicles are not eligible for individual farmers.
• Solar assets: solarisation of any eligible infrastructure, and PM-KUSUM components (grid-connected solar plants up to 2 MW, standalone solar pumps and pump solarisation) in convergence with that scheme. See our note on PM-KUSUM's 2026 status.

Worked example: a ₹1 crore warehouse

Illustrative. An FPO builds a warehouse with a fixed project cost of ₹1 crore.

• Own contribution (10%): ₹10,00,000
• AIF loan: ₹90,00,000
• Bank rate: 9% (the cap); subvention 3%, so effective 6%

First-year interest (simple):

• At 9%: ₹90,00,000 × 9% = ₹8,10,000
• Subvention: ₹90,00,000 × 3% = ₹2,70,000
• Net: ₹5,40,000

Over seven years, repaid in equal monthly instalments (no moratorium, for simplicity):

The saving is roughly ₹11.2 lakh in interest. In practice the bank charges the full rate and the government credits the 3% to the loan account after the bank files claims, so the cash flow is uneven. Try your own numbers in the EMI calculator.

Loans above ₹2 crore: on a ₹3 crore loan at 9%, first-year interest is ₹27,00,000; the subvention is only on ₹2 crore, or ₹6,00,000. The blended effective rate is about 7%.

Documents needed

• Aadhaar and mobile number for portal registration.
• KYC of the borrower; for entities, registration certificate, PAN, board or society resolution.
• Detailed Project Report (DPR): promoter details, project and process flow, cost break-up, means of finance, five-year revenue projections, plant and machinery quotations. Model DPRs are on the portal.
• Land ownership or lease documents for the project site, and building plan approvals where needed.
• Bank statements, past financials or ITRs where available.

How to apply for an AIF loan

1. Register at agriinfra.dac.gov.in with your mobile number and Aadhaar; an OTP generates your login.
2. Fill the application and upload the DPR. Choose the lending institution and branch.
3. PMU verification. The central Project Management Unit checks the application. If the status shows "pending information", correct it and resubmit.
4. Bank appraisal. After verification the application reaches your bank. Visit the branch to complete formalities. The bank decides based on project viability and your credit record.
5. Sanction and disbursement, usually within 60 days if all is in order. Bring your 10% contribution.
6. Subvention and guarantee fee are claimed by the bank from the ministry and credited to your loan account.
7. Geo-tagging. The completed asset is geo-tagged on the Krishi Mapper app.

Registration and application on the portal are free. You may pay a chartered accountant to prepare a DPR, but no "agent fee" is needed to get AIF benefits.

Common reasons applications stall

• Ineligible project, such as standalone secondary processing or working capital.
• Weak DPR with optimistic revenue or missing quotations.
• Credit history issues of promoters; some banks check CIBIL even for FPO members. See how to check your CIBIL score free.
• Bank quoting above 9% on the subvented portion, which is not allowed.
• Land not in the borrower's name or lease too short for the loan tenure.

How to complain

1. If the bank is silent, the portal lets you change your bank after 75 days from verification.
2. For application changes or portal problems, email support.agriinfra@gov.in or use the helpline listed on the portal.
3. For bank-side issues such as rates above the cap or unexplained rejection, write to the bank's grievance officer, then the RBI Integrated Ombudsman at cms.rbi.org.in after 30 days.
4. You can also approach the State Project Monitoring Unit (SPMU) of AIF through your state agriculture department.

For smaller farm working capital, a Kisan Credit Card is the better tool; for non-farm units, compare government business loan schemes.

Key takeaways

• AIF gives 3% interest subvention for up to seven years on loans up to ₹2 crore per project, with lending capped at 9%.
• The credit guarantee fee is paid by the government, so loans up to ₹2 crore need no collateral under the scheme.
• It is for post-harvest, primary processing and community farming assets, not working capital.
• As of October 2026 the scheme is on a temporary extension to 31 March 2027, with terms unchanged.
• Apply free on agriinfra.dac.gov.in with a DPR; switch banks if there is no action in 75 days.