MANU/RMIC/0039/2016

Ministry : Reserve Bank of India

Department/Board : Financial Inclusion and Development Department

Circular No. : FIDD.No.FSD.BC.20/05.10.007/2015-2016
                   RBI/2015-2016/341

Date : 17.03.2016

The Chairman/Managing Director/Chief Executive Officer
All Scheduled Commercial Banks
(excluding Regional Rural Banks)

Madam / Dear Sir,

Pradhan Mantri Fasal Bima Yojana

As you are aware, Government of India has recently approved Pradhan Mantri Fasal Bima Yojana (PMFBY) which would replace the existing schemes of National Agricultural Insurance Scheme (NAIS) & Modified National Agricultural Insurance Scheme (MNAIS) from Kharif 2016. PMFBY would be available to the farmers at very low rates of premium which would be maximum upto 1.5% for Rabi and upto 2% for Kharif for Food crops, Pulses and Oilseeds and upto 5% for Annual Horticulture/ Commercial Crops. This scheme would provide insurance cover for all stages of the crop cycle including post-harvest risks in specified instances.

2. Further, Weather Based Crop Insurance Scheme (WBCIS) has also been modified and the premium payable by the farmers as also its administrative provisions and operationalisation process have been brought on par with PMFBY. In addition, a Unified Package Insurance Scheme (UPIS) has also been approved for implementation on pilot basis in 45 districts of the country to cover other assets/activities like machinery, life, accident, house, student-safety and crops etc. of farmers.

3. The Scheme and detailed Operational Guidelines are available on the GOI's websites www.agricoop.nic.in & www.agri-insurance.gov.in . Guidelines of Pilot UPIS are being prepared by GOI and will be circulated separately.

4. Banks have a vital role to play in increasing the coverage under the scheme. As the scheme is compulsory for loanee farmers availing Seasonal Agricultural Operational (SAO) Loans/Kisan Credit Card (KCC) holders for the notified crops in notified areas, 100% coverage of loanee farmers in notified areas growing notified crops is required to be done by all concerned bank branches. This scheme is voluntary for non-loanee farmers, but there is a prerequisite in the scheme that they should have an account to be eligible for coverage. Under the Pradhan Mantri Jan Dhan Yojana (PMJDY), most of these poorest of the poor farmers have got their bank accounts opened and the banks have to focus on supporting these farmers in getting crop insurance including guiding them throu........