Department of Refinance
 1. Genesis
Reserve Bank of India (RBI) set up the Agricultural Refinance Corporation (ARC) in 1963 to work as a refinancing agency in providing medium term and long term agricultural credit to support investment credit needs for agricultural development. In 1975 this institution was renamed as Agriculture Refinance and Development Corporation (ARDC) with a view to lay emphasize on developmental and promotional role, besides refinancing activities
Upon its formation in 1982, NABARD took over the functions of the erstwhile Agricultural Credit Department (ACD) and Rural Planning and Credit Cell (RPCC) of RBI and Agricultural Refinance and Development Corporation (ARDC)
Today, the Department of Refinance (DOR) deals with short term and long term refinance functions of NABARD which were being addressed by ACD and ARDC respectively before NABARD’s formation.
2. Core Functions of the Department:
DOR mainly deals with:
  • Short term refinance for production credit activities contributing to food security
  • Medium –term and long-term refinance for investment credit activities for giving a boost to private capital formation in agriculture
  • Additionally DOR also acts as a subsidy channelizing agency for various Govt. of India schemes
A.    Short-term Refinance
NABARD provides by way of refinance loans and advances repayable on demand or on the expiry of fixed periods, not exceeding 18 months, to Cooperative Banks, Regional Rural Banks for production, marketing and procurement activities. The basic objective of short-term refinance provision is to supplement the resources of banks and improve credit flow at the ground level. These activities include: 
  • Short-term refinance to State Cooperative Banks and Regional Rural Banks for seasonal agricultural operations
  • Short-term refinance to State Co-operative Banks and Regional Rural Banks for purposes other than seasonal agricultural operations
  • Short-term refinance to Scheduled Commercial Banks, State Co-operative Banks and Regional Rural Banks for lending to weavers
B.    Long-term/Medium-term Refinance
NABARD provides long-term and medium-term refinance to the following institutions to supplement their resources for providing adequate credit for supporting investment activities of farmers and rural artisans etc.
•    Scheduled Commercial Banks
•    Regional Rural Banks
•    State Cooperative Banks
•    District Central Cooperative Banks
•    State Cooperative Agriculture and Development Banks
•    Primary Urban Cooperative Banks 
•    Agricultural Development Finance Companies (ADFCs)
•    NABARD Financial Services Limited (NABFINS)
•    North Eastern Development Finance Corporation Ltd. ( NEDFI) 
•    Non-Banking Financial Companies (NBFCs) 
•    Any other financial institution approved by RBI 
The activities cover both farm sector as well as off-farm sector activities. The tenure of refinancing is in the range of 18 months to 5 years.
C.    Medium-term Conversion
NABARD provides medium term credit limits for conversion of short-term crop loans advanced for financing seasonal agricultural operations (SAO) to State Co-operative Banks and Regional Rural Banks for providing relief to the farmers whose crops are damaged due to natural calamities. 
D.    Long-term loans to State Government
NABARD provides long-term (LT) loans to State Governments to contribute to the share capital of cooperative credit institutions. This reimbursement-based support is intended to encourage larger lending programmes by these cooperatives to meet agricultural credit requirements.
E.    Kisan Credit Card
Government of India (GoI) introduced Kisan Credit Card Scheme during 1998-99 to meet the production credit requirements of the farmers in a timely and hassle-free manner. The scheme is under implementation in the entire country by the vast institutional credit framework involving Commercial Banks, Regional Rural Banks, and Cooperatives. RBI monitors the scheme for Commercial Banks and NABARD for Regional Rural Banks and Cooperatives.
F.    Interfacing for GoI Schemes
As the nodal agency for a number of schemes sponsored by the GoI, NABARD continues to interface between various stakeholders. 
•    Capital Investment Subsidy Schemes:
1.    Agricultural Marketing Infrastructure (AMI) Sub Scheme, Ministry of Agriculture (MoA)
2.    Agri-Clinics and Agri-Business Centres, MoA
3.    Solar Schemes, Ministry of New and Renewable Energy (MNRE)
4.    National Project on Organic Farming
5.    Schemes under Animal Husbandry Sector 
•    Interest Subvention Schemes:
1.    Interest Subvention Scheme for Crop Loans, GoI 
2.    Sugar package
3.    Handloom Sector Packages
3. Broad Achievements of the Department at National Level:
Short Term Refinance:
An amount of Rs.71,217 crore was disbursed as short-term refinance during the year 2015-16. Purpose wise and agency wise break up is furnished as under:
Agency Target (in crores) Achieved ( in crores)
Seasonal Agricultural Operations

State Co-Operative Banks 53775.00 53774.18
Regional Rural Banks 16000.00 16000.45
Public Sector Banks for Primary Agricultural Credit Societies 225.00 226.54
Total 70000.00 70001.17
Others 5919 1222
State Co-Operative Banks 1450.00 1027.22
Regional Rural Banks

Weavers 300.00 188.22

Long Term Refinance:

An amount of Rs. 48063.72 crore was disbursed under long-term refinance during the year 2015-16. Agency wise break up is given as under:
Agency Target (in crores) Achieved ( in crores)
Commercial Banks 20000.00 22823.54
Regional Rural Banks 13699.00 12139.68
State Co-operative Banks 5000.00 6231.12
State Cooperative Agriculture and Rural Development Banks (SCARDBs) 3200.00 3258.26
Total 44999.00 48063.72
Important Links:
Contact Information
Smt. Padma Raghunathan
Chief General Manager
3rd Floor, 'A' Wing
C-24, 'G' Block
Bandra-Kurla Complex, Bandra (East)
Mumbai 400 051
Tel: (91) 022-26524926, (91) 022-26539325
Fax: (91) 022-26530090