Agriculture and allied sectors employ over 54% of the total workforce, accounting for 15% of the country’s Gross Value Added (GVA) in 2022–23. The factors that are contributing to increased agricultural productivity are the usage of agricultural inputs, technological change, and technical efficiency. Agricultural credit is also important for higher yield, especially for small and marginal farmers. Despite persistent efforts, farmers face numerous challenges in availing credit of the right amount and at the right time. Inadequate loans are disbursed against the actual requirements. After availing of the loans farmers often utilize the capital for non-productive reasons, defeating the very purpose of providing financial assistance. During unexpected rainfall or drought farmers get distressed, left with no choice but to take credit from exploitative informal sources. This is a vicious cycle of indebtedness where the poor become poorer. Agriculture insurance is a safety net for such farmers. Farming has become an unattractive sector for the young generation. There is a need to assure farmers of compensation in case of crop failure due to natural disasters, pests, diseases, or any other reasons through tailored insurance products. The Government of India and the Reserve Bank of India (RBI) have been taking appropriate steps to address these issues by establishing adequate institutional structures. Periodic revisions to agricultural loan rules are necessary to adapt to the changing needs of the sector.