Agriculture Infrastructure Fund (AIF): Interest Subvention, Eligibility and Facts
Last updated: 2026-11-13 · MockMentor
The Agriculture Infrastructure Fund (AIF) is a ₹1 lakh crore financing facility for post-harvest and community farm infrastructure such as cold storage, warehouses and grading units. Launched in July 2020, it makes bank loans cheaper through interest subvention and a credit guarantee.
In one line: cheaper, guaranteed bank loans of up to ₹2 crore per project to build the storage and supply chain that farm produce needs after harvest.
At a glance
| Item | Details |
|---|---|
| Launched | July 2020 |
| Duration | 2020-21 to 2032-33 |
| Size | ₹1 lakh crore |
| Interest subvention | 3% a year on loans up to ₹2 crore, for up to 7 years |
| Credit guarantee | Loans up to ₹2 crore, through CGTMSE and NABSanrakshan; fee paid by the Government |
| Lending rate cap | 9% a year |
| Moratorium | 6 months to 2 years |
| Promoter's share | At least 10% of project cost |
Who can borrow
Farmers, Farmer Producer Organisations (FPOs), Primary Agricultural Credit Societies (PACS), cooperatives, State agencies, agri-entrepreneurs and startups. A private entity can get support for up to 25 projects; APMCs can take several projects within their market area.
Who lends
Commercial banks, cooperative banks, Regional Rural Banks, small finance banks, the National Cooperative Development Corporation (NCDC) and NBFCs. NABARD refinances cooperative banks and RRBs.
Facts to remember
- AIF loans count as priority sector lending under agriculture infrastructure.
- The interest subvention is credited straight into the borrower's loan account.
- Lower post-harvest losses can ease food inflation, which links AIF to monetary policy.
- AIF loans also fund the 20% loan share in the Namo Drone Didi scheme.
Possible exam questions
- How does the Agriculture Infrastructure Fund reduce post-harvest losses? What limits its reach?
- Explain how interest subvention and credit guarantees change banks' willingness to lend to agriculture.
Complete notes in our courses: the Super-Elite and Elite courses carry the full AIF chapter with updates and practice MCQs. Compare the courses.
More in Agriculture schemes
- PM Dhan-Dhaanya Krishi Yojana
- Mission for Aatmanirbharta in Pulses
- PM-KISAN
- PM Kisan Maan-Dhan
- PM Fasal Bima Yojana
Prepare with MockMentor
RBI Grade A/B 2027 Super-Elite Course (₹7,500) – Complete Phase 1 and Phase 2 preparation with the Descriptive Writing Programme. 365 days validity.