Friday Jan 02, 2026
Friday Jan 02, 2026
Friday, 2 January 2026 00:00 - - {{hitsCtrl.values.hits}}
The Government yesterday announced the introduction of a concessionary pledge loan scheme aimed at supporting small and medium-scale paddy millers and cooperative societies in purchasing paddy from farmers during the Maha season 2025/26, as part of efforts to ensure stable and reasonable farm-gate prices.
The scheme will be implemented from 1 January and is designed to strengthen market demand for paddy during the peak harvesting period, thereby helping farmers secure prices aligned with the Minimum Purchase Price (MPP) declared by the Department of Agriculture, a statement issued by the Finance Ministry’s Department of Development Finance noted.
Under the program, eligible borrowers will include SME paddy millers and cooperative societies with a maximum daily milling capacity of 25 tons. All applicants must hold a valid business registration issued by a relevant Government institution and a licence from the Paddy Marketing Board, ensuring that only formally registered operators benefit from the facility.
The Department said participating millers and cooperatives will be able to access loans of up to Rs. 50 million at a concessionary interest rate of 7% per annum. The loans are to be repaid within a period of 180 days, reflecting the seasonal nature of paddy procurement and milling operations.
A total of 15 banks, including State-owned, private, and specialised financial institutions, have been selected to participate in the scheme, broadening access across regions and banking networks. These include; Bank of Ceylon, People’s Bank, Regional Development Bank, Hatton National Bank, Seylan Bank, Sampath Bank, Commercial Bank of Ceylon, DFCC Bank, National Development Bank, Nations Trust Bank, Sanasa Development Bank, Amana Bank, Cargills Bank, Pan Asia Banking Corporation, and the State Mortgage and Investment Bank.
The estimated total value of loans to be disbursed under the scheme for the Maha season 2025/26 is around Rs. 10 billion. The Finance Ministry said the funds are expected to play a key role in facilitating timely paddy purchases at the officially declared MPP, helping to protect farmer incomes while ensuring sufficient liquidity for millers and cooperatives.
The initiative forms part of broader Government efforts to stabilise the agricultural sector, strengthen food security, and improve the efficiency of paddy marketing during the country’s main cultivation season.
