Agricultural Loans in AP Receive a Boost Over Past Three Years

Disbursement of agricultural loans in Andhra Pradesh has witnessed a significant rise over the past three years, according to data released by the State-Level Bankers’ Committee.

As per data, total agricultural loans extended by the group of banks in AP stood at `3,10,285 crore at the end of 2023–24. These increased to `3,36,939 crore in 2024–25. In 2025–26, the figure surged to `3,92,148 crore, registering an annual growth of 16.40 per cent.

This trend indicates a stronger focus of banks in expanding credit to the agricultural sector, which include loans extended towards crop cultivation, agricultural term lending, and infrastructure and allied activities. These play a key role in boosting the farm sector.

A senior manager of State Bank of India in Kadapa town said, “We have significantly increased the share of crop loans in 2026. At the same time, term loans have also gone up. Lower levels of NPAs in agriculture have given us some flexibility to expand lending.”

Crop loans continue to dominate, reaching `2,01,701 crore in 2025–26, a 51.43 per cent share of the total agricultural credit, reflecting a growth of 2.90 per cent over the previous year. Agricultural term loans, which help farms and agribusinesses fund long or medium term capital investments like farm machinery and setting up irrigation systems, had a share of 38.90 per cent, rising to `1,52,560 crore over the previous year, with a notable growth of 28.79 per cent.

Banks performed well under the Annual Credit Plan for 2025–26. Against a target of `1,86,000 crore for crop loans, disbursements reached `2,00,152 crore. In the term loan segment, banks exceeded expectations by disbursing `1,46,330 crore against a target of `97,000 crore.

Veerla Sivanarayana, a farmer from Bethamcherla mandal in Nandyal district, said, “Earlier, I used to get only `2.25 lakh for my five-acre land. Now, the bank has sanctioned `3.50 lakh. This has provided the much-needed financial relief.”

Overall, banks surpassed targets in total agricultural lending as well. Against a combined Kharif and Rabi target of `3,06,000 crore, they disbursed `3,86,249 crore.

Officials note that sustained credit support to agriculture is helping improve farmers’ financial stability, thereby strengthening the rural economy.

However, bankers have concerns over lending to the MSME sector. “In some districts, NPAs in industrial loans are around eight per cent, which causes worry,” a senior Union Bank of India official disclosed.

AGRICULTURAL LOANS STATISTICS (₹ in Crore)

Financial Year Total Loans

CATEGORY-WISE LOANS 2025-26