Kisan Credit Card (KCC)
Agriculture Schemes
Kisan Credit Card (KCC) scheme was Introduced in 1998-99. This model scheme was prepared by the National Bank for Agriculture and Rural Development (NABARD) on the recommendations of R.V.GUPTA committee
A Kisan Credit card has been specially designed to provide farmers of the country a financial support.
Its objective is to meet the comprehensive credit requirements of the agriculture sector and by 2019 for fisheries and animal husbandry by giving financial support to farmers
The KCC scheme is being implemented by the all Co-operative banks, Regional Rural Banks and Public Sector Banks throughout the country.
| Quick Point | |
| Introduced In | August 1998 |
| Scheme was prepared by | NABARD |
| KCC Start on Recommendations | R.V.Gupta committee |
| Permissible Limit | 5 years |
| KCC Credit for | Agriculture, Fisheries and Animal Husbandry farmers |
| Agriculture Credit Target For 2019-20 | 13.5 Lakh Crore |
Scheme also covers risk of KCC holders against death or permanent disability resulting from accidents. KCC credit holders are covered under personal accident insurance up to ₹50,000 for death and permanent disability, and up to ₹25,000 for other risk.
Maximum Permissible Limit 5 years
- For every successive years (2nd, 3rd, 4th, and 5th year), the limit will be stepped up @10%.
The Government has been implementing Interest Subvention Scheme since 2006-07. Government had decided to ensure that farmers receive short term credit at the ground level at 7% with an upper limit of Rs.3.00 lakh for a maximum period of one year for prompt repayment on or before the due date. The policy came into force with effect from Kharif 2006-07. Thus, farmers, who promptly repay their crop loans as per the repayment schedule fixed by the banks, are extended loans at an effective interest rate of 4% per annum. The Govt has extended the scheme to crop loans borrowed from private sector scheduled commercial banks in respect of loans given within the service area of the branch concerned.
| Interest Subvention Scheme | |
| Interest Rate on KCC | 9% |
| Relief due to Interest Subvention Scheme | -2% |
| Relief due to promptly repay the loans on or before the due date or the date fixed by the bank | -3% |
| Final Effective Interest Rate on KCC | 4% |
The KCC scheme is being implemented by the all Co-operative banks, Regional Rural Banks and Public Sector Banks throughout the country.
Scheme covers risk of KCC holders against death or permanent disability resulting from accidents.
| Year | Target | Achievement | SF/ MF Share |
| 2016-17 | 9 lakh crore | 118.42% | 50.14% |
| 2017-18 | 10 lakh crore | 116.26% | 49.93% |
| 2018-19 | 11 lakh crore | 114.06% | 49.90% |
| 2019-20 | 13.5 lakh crore | — | — |
SF/ MF:- Small and Marginal farmers Share in Credit taken
Q. Maximum target is given for which state in 2019-20:- Uttar Pradesh
| Priority Sector Lending | |
| Agriculture Comes Under | Priority Sector |
| According to RBI, Total Priority Sector Lending by Bank | 40% ANBC or Credit Equivalent Amount of Off-Balance Sheet Exposure, whichever is higher. |
| Priority Sector Lending For Agriculture Sector | 18% ANBC or Credit Equivalent Amount of Off-Balance Sheet Exposure, whichever is higher. |
| Within the 18 percent target for agriculture, a target of 8 percent of ANBC or Credit Equivalent Amount of Off-Balance Sheet Exposure, whichever is higher is prescribed for Small and Marginal Farmers. | |
The Government of India/ Reserve Bank of India (RBI)/ NABARD have, inter alia, taken the following major initiatives for providing hassle free crop loans to farmers including SF/MF :-
- With a view to ensure availability of agriculture credit at a reduced interest rate of 7% p.a. to the farmers, the Government of India in the Department of Agriculture, Cooperation and Farmers Welfare implements an interest subvention scheme for short term crop loans up to 3.00 lakh. The scheme provides interest subvention of 2% per annum to Banks on use of their own resources. Besides, additional 3% incentive is given to the farmers for prompt repayment of the loan, thereby reducing the effective rate of interest to 4%.
- As per RBI directions, Domestic Scheduled Commercial Banks are required to lend 18% of the Adjusted Net Bank Credit (ANBC) or Credit Equivalent to Off-Balance Sheet Exposure (CEOBE), whichever is higher, towards agriculture. A sub-target of 8% is also prescribed for lending to small and marginal farmers including landless agricultural labourers, tenant farmers, oral lessees and share croppers. Similarly, in the case of Regional Rural Banks 18% of their total outstanding advances is required to be towards agriculture and a sub-target of 8% has been set for lending to small and marginal farmers.
- Under the Kisan Credit Card (KCC) Scheme, a flexible limit of 10,000 to 50,000 has been provided to marginal farmers (as Flexi KCC) based on the land holding and crops grown including post harvest warehouse storage related credit needs and other farm expenses, consumption needs, etc., plus small term loan investments without relating it to the value of land.
- To enhance coverage of small and marginal farmers in the formal credit system, RBI has decided to raise the limit for collateral-free agriculture loans from 1 lakh to 1.6 lakh.
- The requirement of ”no due’ certificate has also been dispensed with for small loans up to 50,000 to small and marginal farmers, share-croppers and the like and, instead, only a self-declaration from the borrower is required
- To bring small, marginal, tenant farmers, oral lessees, etc. into the fold of institutional credit, Joint Liability Groups (JLGs) have been promoted by banks.
| More Government Scheme | Click |
