How to get a loan for the development of private households with state support

Loans for the development of private household plots, which are offered by Sberbank and Rosselkhozbank, are issued strictly for intended use. If the borrower complies with all the rules for providing financing, a loyal interest rate remains for him, and a program for receiving subsidies from the state is also available. The amount of the loan to be subsidized cannot exceed 700 thousand rubles.

Running a personal subsidiary farm allows rural residents not only to provide themselves with fresh natural products, but also to earn through the further sale of the produced raw materials. Since the purchase of a livestock of animals, the arrangement of their own and their housing and the organization of the farm's activities require large financial investments, a novice farmer may need additional financial assistance. Leading Russian banks offer their clients a specialized product - a loan for private household plots.

A limited number of banks in Russia specialize in loans for the development of personal subsidiary plots. The largest and most reliable lending institution in the segment was and remains the Russian Agricultural Bank.

Both financial corporations are universal banking organizations, have government support and participate in a subsidy program.

Lending objectives

The purposes of lending to persons running personal subsidiary plots are defined in the corresponding order of the Ministry of Agriculture of the Russian Federation and are applicable to all financial institutions participating in the financing programs for private household plots.

Table 1. Goals that allow you to take out a loan for the development of private household plots

*For up to 2 years, for production purposes*	For up to 5 years, for agricultural purposes *
seasonal costs of the agricultural producer; Fuels and lubricants, spare parts for equipment of trucks or tractors; seedlings, tubers, bulbs, mushrooms and myceliums, seeds and planting material; fertilizers, black soil, sand, humus, etc.; materials for the repair and reconstruction of premises on the territory of the site, including those provided for keeping animals, as well as fences and barriers; for insurance premiums for product insurance; payment for electricity used for irrigation; providing irrigation on the territory of the site (laying a water supply system, purchasing related materials, including hoses and tanks); containers and other packaging material; making advance payments for purchased new equipment and equipment, as well as payment for services for its delivery, assembly, installation, start-up and debugging; rent for the land and premises used by private household plots; small-scale mechanization equipment and special agricultural implements; raw materials for primary as well as industrial processing; feed and veterinary drugs, materials for greenhouses	farm animals, including those suitable for cattle breeding; purchase of equipment for processing products, animal husbandry; gasification of private household plots; the purchase of vehicles and machines for agricultural activities, including specific ones: for animal husbandry, beekeeping, poultry farming, fodder production and fish farms; welding and power units; reclamation work; insurance of purchased machinery and equipment; purchase of snow and swamp vehicles and ATVs; materials for the creation and arrangement of reservoirs for fish farming; installation of gas equipment on self-propelled agricultural equipment; ownership of agricultural land; pre-fabricated hangars (purchase and installation); equipment for the disposal and / or storage of products / waste; installations and units for collecting rainwater and irrigation, pumping stations; boats: inflatable, motor and rowing boats, as well as parts for them; construction, repair and reconstruction of premises intended for animal husbandry
*Up to 5 years for non-agricultural activities, in agricultural areas*	*Up to 5 years, subject to the maintenance of private household plots, for the purchase*
agricultural tourism; folk crafts; trade in a specified area; rendering of services of a household nature to the population; collection, preparation and processing of berries, herbs, fruits, etc.	general transport; tractors and agricultural machines; specialized vans; equipment for trade and organization of catering units; machines for sericulture, beekeeping, livestock, poultry, feed production and work in the open field; welding, power and gas installations and units. Important! Part of the cost is paid from the farmer's own funds
*restrictions on the country of manufacture indicated for the acquisition may apply, most often financing is provided for cars produced in the territories of the Customs Union

You can familiarize yourself with the full list of goals provided by the Rosselkhozbank for loans to private household plots, as well as the decoding of product codes. Up to date as of 05/30/2018.

Attention! After receiving financing, the borrower is obliged to provide the bank with confirmation of the intended use of the loan funds.

Requirements for farmers

Individuals applying for a loan from a bank to expand farming are subject to a number of requirements that are different from private and commercial lending.

Table 2. Requirements of banks for borrowers

*Requirement*		*Sberbank*	*Rosselkhozbank*
Age	From (at the time of applying for a loan)	21	23
	Until (inclusive at the time of the return of the entire amount of the debt)	75	75
Citizenship		Strictly Russian Federation
Official employment*		Mandatory (provided that the salary is taken into account), the term of work in the last place is at least 6 months, total - at least 1 year over the last 5 years for third-party borrowers, and at least 3 months - without restrictions on length of service - for those who receive wages to an account with Sberbank	Required when obtaining a loan by a person who has been running a private household for less than 12 months. Work experience in the last place of work - at least 6 months, total - from 1 year over the last 5 years (with the exception of pensioners). For RSHB clients on wages and with a positive credit history in the bank, the requirement has been reduced to 3 months. at the last place of work and 6 months. total work experience
* Unemployed citizens can be provided with financing only on condition that income from private household plots is received for more than 12 months or state benefits and pensions are assigned
registration		Permanent / temporary, at the place of obtaining a loan and maintaining private household plots	Permanent registration on the territory of the Russian Federation
Additionally		The loan is provided to the person who is indicated in the household book by the first (main) owner	the presence of a personal subsidiary farm, reflected in the household book, on the territory of the bank's branch, to which the client applies for financing; the presence of a land plot for running private household plots, which is owned, the right of unlimited use or long-term lease; own tools, inventory and minimum buildings for conducting business, taking into account the specifics of the business; an entry in the household book of at least 12 months preceding the date of filing an application for funding

Important! If the land for running a personal subsidiary farm is used by the borrower under a lease agreement, then the loan term cannot exceed the period of its validity. The condition is applied by all banks issuing loans for the specified purposes.

An important criterion when considering an application for any loan is the borrower's credit history.

Loan security

Loans for private household plots involve the provision of collateral with liquid property and / or a guarantee of third parties in accordance with the requirements of a particular financial institution.

Table 3. Collateral claims of creditors

*Security*	*Rosselkhozbank*	*Sberbank*
Surety	At least 1 individual, a legal entity can act as an additional guarantor	Guarantee of natural persons is obligatory. No more than 2 contracts of surety of third parties are concluded
Liquid property	May be owned by the borrower, co-borrower or third party, including a legal entity	Optional, can be used as an additional condition following the results of the credit committee
Purchased machinery and equipment	When a loan is issued, the purpose of which is to acquire these funds, they are also pledged to the bank until the loan is repaid

Important! Banks have the same requirements for guarantors to individuals as for a borrower. At the same time, income from private household plots for which a loan is taken is not taken into account in calculating the solvency of guarantors and co-borrowers.

You can familiarize yourself with the full requirements of the RSHB for collateralized property.

Lending conditions at Rosselkhozbank and Sberbank

General conditions for lending to citizens of the Russian Federation for running personal subsidiary plots are applied on the basis of the norms approved by state legislative acts, however, financial institutions have the right to make adjustments to them. So, the conditions from Sberbank on a loan for private household plots differ from those offered by Rosselkhozbank.

Table 4. Lending conditions for private household plots

*Characteristic*		*Sberbank*	*Rosselkhozbank*
Funding currency		Russian ruble
Term, months		Minimum 3 months, maximum 23 or 59, according to the terms of the selected loan program	From 3 months to 24 or 60, depending on the purpose of financing
Prolongation of repayment due to seasonality of private household plots		Permissible	Yes, for loans up to 2 years - no more than 12 months, up to 5 years - no more than 24 months.
Security		Guarantee of individuals	Guarantee of individuals or legal entities, pledge of liquid and acquired property
Loan amount	Minimum	30 thousand rubles.	Not installed
	Maximum	RUB 1.5 million	Up to 1 million rubles. - for all borrowers; Up to 1.5 million rubles. - for the bank's clients who were recognized as "reliable" (previously received loans from the RSHB were repaid without violating the terms of the agreements)
Interest for use		17% per annum	All clients	11% - up to 12 months
				13% - from 12 to 60
			"Reliable"	10.5% - up to 12 months
				12.5% - from 12 to 60
			Adjustment rates: + 2.5% for failure to submit documents on the intended use of funds; + 4.5% if the party to the transaction refuses to conclude a life insurance contract, if his age is less than 65 years, for persons who have reached the specified age + 5%
Issuance fee		Not provided	Absent
Procedure for receiving		In whole or in parts, to a card / current account or in cash	Lump sum to the current account with the Russian Agricultural Bank

Attention! The maximum credit limit means the total amount of loans issued to private household plots for the year.

To calculate the amount of repayment and overpayment on a loan for a private household plots in the Russian Agricultural Bank, a special calculator is provided on the company's website, which, among other things, will help determine the possible amount of government subsidies.

Subsidy from the state for a loan for private household plots

Agricultural development is an active government initiative. The segment is maintained and developed at the expense of budgetary funds, however, since 2013, the financing and subsidy programs for the industry have been largely reoriented to large manufacturers.

Receive a loan subsidy for private household plots, according to Decree of the Government of the Russian Federation No. 396 of 03/31/2017(with changes and additions from 01.03.2018) Doc_3, only those farmers who have entered into a loan agreement can:

from 01.01.2005 for a period of up to 5 years for the purchase of animals, equipment for processing agricultural products, animal husbandry, repair, reconstruction and construction, connection of gasification, with the amount of financing up to 700 thousand rubles;
from 01.01.2007 for a period of up to 2 years for the purchase of fuels and lubricants, spare parts and materials for the repair of equipment, premises, young animals, fertilizers, seeds, veterinary drugs and payment of insurance premiums for insurance of agricultural products, while the total loan cannot exceed 300 thousand rubles.

State support is possible in the following volumes:

up to 95% of the discount rate of the Central Bank of the Russian Federation under agreements concluded before 31.12.2012;
for credit transactions executed from 01.01.2013, 2/3 of the refinancing rate established by the Central Bank of the Russian Federation.

Reimbursement to the farmer is agreed on the basis of the data received from the lender, including the amount of interest paid and the body of the loan, the balance of the debt and the documents provided confirming the intended use of the funds.

Important! Deals without targeted confirmation are not subsidized.

After agreeing on the provision of a subsidy for a loan, the amount due is transferred from the budget to the account of the credit institution within 30 calendar days, and from there to the account of the person who maintains a personal subsidiary farm.

How to get a loan for the development of private household plots

To receive a loan for maintaining a private household plots, the borrower, regardless of the financial institution in which the contract will be concluded, must be entered in the household book of the financed land. The terms of consideration and the procedure for issuing a loan may differ.

Table 5. Procedure for issuing a loan

The process of considering an application for a loan for private household plots begins after the farmer has provided a full package of documents required by the bank.

Required documents to take out a loan

Obtaining a loan is possible only if a potential borrower submits a package of documents, including personal information, proof of income, data on private household plots, pledge and surety papers.

Table 6. Required package of documents Employment book or other document confirming employment.

Documents for private household plots . Extract from the household book about the accounting of the borrower's private household plots Pledge registration Documents confirming ownership, a report on the assessment of the subject of pledge, insurance contracts, etc. Not required

Intended use documents

Interest rates indicated by banks as valid for loans to private household plots require the borrower to provide documents that reflect the intended use of the funds received. If the farmer does not provide the necessary papers on time, the rate will be increased to the value at which consumer loans are issued. When should the documents for the spent grant be submitted:

in PJSC "Sberbank" you need to report within 90 days from the moment you managed to get a loan, regardless of the purpose;
PJSC "Rosselkhozbank": acquisitions - 90 days, for the purchase of equipment that is pledged to the bank - up to 75 days, for complex repair and construction works, as well as gasification - 180 days.

For reference! The list of documents required to confirm the targeted use of funds is determined by the Ministry of Agriculture of Russia, you can get it at the time of the transaction from a bank employee based on the purpose of financing.

For many citizens, the maintenance of private household plots is becoming an alternative to hired work. With special loan programs, the farmer can avoid the seasonal financial gap and ensure business continuity. Reliable banking institutions should be considered as a lender so that obtaining a loan would help in the development of the economy.

Higher education. Orenburg State University (specialization: economics and management at heavy engineering enterprises).
June 8, 2018.