Pledge Finance

In harvesting season there is a huge arrival of particular commodity in the market in very short period, which causes substantial fall in market prices of the commodity. Farmers do not have capacity to hold their stock, so they have to sell their produce at a very meager rate in the market. Under the pledge loan scheme the farmer keeps his produce in the APMC godown and gets 75% of the value as loan. As the prices of the commodity rise in the market the farmer sells his produce in the market and repays his loan and thus fetches higher price for his produce reasonable levels.


Since 1990, the MSAMB has been implementing this scheme of pledge loan for the benefit of farmers of the State. The scheme of pledge loan is available for Moong, Tur, Udid, Soyabean, Paddy, Sunflower, Safflower (Kardai), Gram (Chana), Jawar, Bajra, Maize, Wheat, Ghewda (Rajma), Turmeric, raisin(Bedana), Cashew nuts and Betel nuts (Supari) in this scheme.

Under this scheme, a farmer can store his produce in Godowns of APMC and can immediately get 75% cost of his produce at an interest rate of 6%. Farmer can avail the pledge loan facility by storing the produce in the godowns of state Warehousing Corporation or Center Corporation. The APMCs maintain this pledged stock free of cost. The farmers can sell their produce when the prices are higher.

Under the scheme, the farmer gets agricultural pledge loan up to 75 % of the value of the produce prevailing in the market, an interest rate of 6%. The farmer is allowed to avail this facility up to a period of 180 days. Rebate of 3% on interest is given as promotional incentive to those APMCs who repay within 180 days. If APMC fails to repay within 180 days then APMC cannot avail the incentive rebate of 3%. After 180 days interest rate will be 8% for next 6 months, after that interest rate will be 12% next 6 months.

MSAMB has disbursed Rs.23,324.75 Lacks Agricultural pledge loan to the farmers of Maharashtra State through APMCs since 1990-91 up to 2019-20 as a marketing initiative.

Commodity wise loan Limit & Rate of Interest of lone :-
No Commodity Limit of Loan Period Rate of Interest
1 Soyabean, Tur, Moong, Udid, Paddy, Safflower (Kardai) Sunflower, Turmeric and Gram, Jawar, Bajra, Maize & Wheat 75 % of total cost (as per market rate or MSP which is less) 180 days 6%
2 Ghewda (Rajma) 75 % of total cost. Or maximum Rs. 3000/- per Quintal (which is less) 180 days 6%
3 Cashew nuts 75 % of total cost. Or Rs. 100/- per Kg (which is less) 180 days 6%
4 Betel nuts (Supari) 75 % of total cost. Or Rs. 100/- per Kg (which is less) 180 days 6%
5 Raisin (Bedana) 75 % of total cost. Or maximum Rs. 7500/- per Quintal (which is less) 180 days 6%
  • Under this scheme, only the producer farmers are eligible for the pledge loan. Traders are not eligible under this scheme.
  • The cost of Produce is determined by the market price of the day or the MSP announced by the government, whichever is less.
  • Period of pledge loan is 6 months (180 days), and interest rate of 6%.
  • Market Committee which makes repayment of loan within the prescribed period of 6 months (180 days) are applicable for 1% or 3% interest subsidies on loan amount from MSAMB.
  • Market committees are also eligible for 1% or 3% incentive interest subsidies on the loan amount which distributes the pledge loan from the self-fund.
  • Calculation of rate of interest on loan amount is – up to 180 days 6%, 180 days to 365 days 8% & after 365 days 12%.
  • The market committee takes responsibility of storage, monitoring and security of the mortgaged goods free of cost. And the responsibility of the concerned market committee to insure mortgage of the goods.
  • Mortgage loan is also provided by the market committees on receipt of warehouse receipts of State or Central Warehousing Corporation

Pledge Finance Scheme- Circular & Form (Download)

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