Can I apply for a loan if I’m a new dairy farmer with no prior experience?

Yes, new dairy farmers with no prior experience can apply for loans to start or expand their operations. However, getting approved may be more challenging than for established dairy farmers. Here are some tips for new dairy farmers seeking loans:

• Choose the Right Lending Institution: Seek out loan providers familiar with the dairy industry. Look for banks, Non-banking Financial Companies (NBFCs), credit unions, or financial institutions specialising in dairy farm lending. Their expertise can help your application.
• Present a Strong Business Plan: Highlight your business plan and financial projections. Loan providers want to see a solid business plan, cost projections for equipment/supplies, and realistic financial projections showing how you’ll generate revenue to repay the loan.
• Use Collateral to Improve Loan Approval Chances: As a newer farmer, having assets to secure the loan can improve your chances. Collateral could include farm real estate, equipment, livestock, or personal assets.
• Build Your Financial Credibility: Start small and request a smaller loan amount. Asking to start with a smaller operating loan you can repay in 1-2 years can establish your reliability.
• Make Use of Government-backed Initiatives: Explore government-backed loans. Initiatives like the Kisan Credit Card (KCC) scheme and the National Bank for Agriculture and Rural Development (NABARD) scheme can offer favourable rates and terms for beginning farmers who can’t get traditional financing.