Madhya Pradesh Zero-Interest Short-Term Crop Loan Scheme
Short-term crop loans up to ₹3 lakh at 0% interest for farmers who repay on time, through primary agricultural cooperative societies (PACS).
Run by: Cooperative Department (Sahkarita Vibhag), Government of Madhya Pradesh
- Interest to farmer
- 0% if repaid on time
- Loan limit
- Up to ₹3 lakh
- State subsidy
- 1.25% + 4% on-time incentive
- Repayment time
- 12 months from first withdrawal
Overview
Madhya Pradesh has run a zero-interest crop loan scheme since 2012-13. A farmer takes a short-term crop loan from a primary agricultural cooperative society (PACS) linked to a District Central Cooperative Bank, and if the loan is cleared on time the farmer pays no interest.
This works because the state steps in on interest. The state gives a 1.25% interest subsidy, and farmers who repay by the due date get an additional 4% incentive subsidy. The state covers the remaining interest after counting the central government's interest support, which brings the farmer's interest cost to zero. The loan limit is up to ₹3 lakh.
In June 2026 the State Cabinet approved revised rules for 2026-27 (Free Press Journal, Rural Voice). The farmer now gets a single annual credit limit instead of separate Kharif and Rabi limits, with different sub-limits for cash and for inputs bought through the society. The repayment period is 12 months from the date of the first withdrawal.
The reports do not give the number of farmers covered in 2026-27 or the total cost to the state, so no such figure is quoted here. The scheme is closely linked with the Kisan Credit Card, and many farmers get it through their PACS card.
What you get
The benefit as the state notifies it — nothing here is an estimate.
- Crop loan up to ₹3 lakh at 0% interest when you repay by the due date.
- State interest subsidy of 1.25%, plus an extra 4% incentive for timely repayment.
- One annual credit limit for the year (2026-27 rule) instead of separate Kharif and Rabi limits.
- 12 months to repay, counted from your first withdrawal.
Who is eligible
State schemes usually state their criteria as prose rather than a checklist. This is that prose, unpacked — the department’s verification is what decides.
You qualify if
- Farmer who is a member of a primary agricultural cooperative society (PACS) in Madhya Pradesh
- Takes a short-term crop loan through the PACS and its District Central Cooperative Bank
- Repays the loan by the due date to keep the interest at zero
Not covered
- Interest-free benefit is for timely repayment — late repayment can bring interest charges.
Documents you need
Have these ready before you start — most rejections are a missing paper, not a missing right.
- Aadhaar card
- Land records (khasra / B-1) of your cultivated land
- Bank passbook of the PACS or cooperative bank account
- Passport size photograph
How to apply
Fewer steps than a central scheme, and usually one office rather than a portal.
- 1
Go to your PACS
Visit the primary agricultural cooperative society where you are a member, and ask for the crop loan limit for 2026-27.
- 2
Submit your documents
Give land records, Aadhaar and bank details. The society will tell you the exact list for your case.
- 3
Know your sub-limits
Under the new rule your annual limit is split into a cash part and an input part. Ask the society secretary how much you can take in each.
- 4
Repay on time
Pay back within 12 months of your first withdrawal. Timely repayment is what keeps your interest at zero and earns the 4% incentive.
If something goes wrong
Missing from the list, or payment stuck — here is the channel the department itself publishes for it.
- First, the manager of your PACS or the District Central Cooperative Bank branch, and then the Assistant Registrar (Cooperative) of your district.
- For escalation, use the MP CM Helpline: cmhelpline.mp.gov.in or call 181 (7 am – 11 pm).
Frequently asked questions
Do I really pay zero interest?
Yes, if you repay the short-term crop loan by the due date. The state's 1.25% subsidy and 4% incentive cover your interest cost.
What is the maximum loan?
Up to ₹3 lakh per farmer under the zero-interest scheme.
What changed for 2026-27?
A single annual credit limit replaces separate Kharif and Rabi limits, with different sub-limits for cash and inputs. Repayment is due 12 months after the first withdrawal.
What if I repay late?
The zero-interest benefit depends on repaying by the due date. Late payment can mean interest is charged, so ask your society for the exact rule before the date.
Is this the same as a Kisan Credit Card?
Not the same, but linked. The scheme gives the interest benefit on short-term crop loans taken through PACS, and many farmers use a KCC for that credit.
Can I get this loan from a commercial bank?
The scheme runs through PACS and the District Central Cooperative Banks. The reports do not mention commercial banks.
Since when has the scheme been running?
Since 2012-13, through the same PACS and District Central Cooperative Bank structure.
Facts checked against cooperatives.mp.gov.in on 4 October 2026. editorial policy.