Kisan Credit Card Scheme (KCC)

The Government of India has come up with a new scheme named Kisan Credit Card (KCC) to reduce informal credit access among farmers involved in agriculture, animal husbandry, fisheries.

Want to know more about it? Stay tuned!

Launched in 1998 by the Government of India, the Kisan Credit Card scheme aims to provide short-term formal credit to farmers. This scheme especially focuses on farmers engaged in animal husbandry, fisheries, agriculture, etc.

Through Kisan Credit Cards, farmers are provided with a credit limit which they can use to purchase equipment and cover other expenses. The Kisan Credit Card Yojana is implemented by NABARD (the National Bank for Agriculture and Rural Development).

The main objectives of this scheme are to -

• Meet short-term credit needs for crop cultivation.
• Cover post-harvest expenses.
• Meet the consumption demand of the farmer’s household.
• Ensure marketing loan.
• Offer working capital for maintaining farm assets and activities related to allied sectors including dairy animals, floriculture, horticulture, and inland fisheries.
• Fund investment credit requirement for agriculture and allied sectors for purchasing pump sets, sprayers, dairy animals, etc.
• Give short-term credit facility for rearing birds, fishes, shrimps, and other aquatic animals.

The features of Kisan Credit Card are as follows -

• Eligible farmers will get a Kisan Credit Card and passbook or card cum passbook.
• Farmers can get the facility of rescheduling loans in case of damage to crops due to natural calamities.
• Farmers will avail of a Kisan Credit Card limit (credit) based on operational land holding, cropping pattern and scale of finance.
• Banks with the authority have to decide sub-limits to cover short term, medium-term and term credit.
• Kisan Credit Card comes with a validity of 5 years and is subject to annual review.

Note: Farmers having good performance can enjoy incentives, i.e., higher credit limits to manage increased costs, change in cropping pattern, etc.

• The Reserve Bank of India takes decisions about margin, security, rate of interest, etc.
• Production credit requirements for a year along with ancillary activities related to crop production will be determined while fixing the limit.
• Kisan Credit Card related operations will be done through issuing branches, PACS in case of Cooperative Banks and through other designated bank branches.
• Farmers can withdraw through slips or cheques accompanied by a card and passbook.
• Crop loans under the Kisan Credit Card scheme are further covered under the Crop Insurance Scheme. This scheme protects farmers against any kind of loss caused by natural calamities, pest attacks etc.

Now that you about the features of this scheme, let us learn about the Kisan Credit Card benefits. These are -

• Kisan Credit Card ensures simplified disbursement procedures
• This government-backed card brings flexibility in handling cash and related matters.
• This scheme eliminates the need to apply for a loan for every crop
• PM Kisan Credit Card ensures immediate credit access that helps reduce the interest burden for the farmer.
• Through this card, farmers can purchase seeds, fertilizers as per the farming requirement
• Farmers can opt for 3 years of credit facility.
• Farmers involved in agriculture, animal husbandry, etc., can avail the maximum credit limit on the basis of agriculture income
• They can withdraw loan amounts based on the credit limit.
• They can enjoy the advantage of repaying only after harvest.
• Further, this card helps to avail discounts from dealers.
• Security, margin and documentation rules depend on agricultural advance
• Kisan Credit Card scheme takes care of the entire year’s credit requirement. Simple documentation makes withdrawal even easier.
• Farmers can enjoy flexibility in withdrawing cash and purchasing inputs.
• Also, they can enjoy the flexibility of withdrawals from a branch (other than the issuing branch) at the discretion of the bank.

Following is a list of Kisan Credit Card eligibility,

• The age of the applicants or farmers must be between 18-60 years old.
• Applicants (individuals/groups of people) must own agricultural land.
• In case individuals/group of people do not have their own land, they must take rented land for cultivation.
• Lands of farmers must be agriculturally active i.e. produce crops.

The eligibility criteria of Kisan Credit Card for fisheries and animal husbandry is discussed below,

• Fish farmers, fishers, SHGs, JLGs, and women groups (Inland fisheries and aquaculture)

Note: Applicants must own or lease any fishery-related activities. This may include leasing a pond, a hatchery, a tank etc. 

• Applicants must own a registered fishery boat or any other vessel. Note: They must have permission for fishing in the sea or estuary. (Marine fisheries)
• Farmers, dairy farmers, tenant farmers, SHGs, JLGs who own, lease, or rent shed. (Dairy)
• Individual or joint borrowers, tenant farmers, SHGs, JLGs of sheep, birds, poultry, rabbits, goats, pigs and have sheds of their own/ taken on rent/ leased. (Poultry)

Eligible farmers can apply for Kisan Credit Card both online and offline. Both the processes are discussed below,

Apply Kisan Credit Card Online

• Step-1- Visit the official website of any nationalised bank and navigate to the section of Kisan Credit Card.
• Step-2- Download and print the application form.
• Step-3- Fill in the application form with correct details and submit it with essential documents.
• Step-4- Once the loan amount is sanctioned, farmers will receive the card.

Apply for Kisan Credit Card - Offline Procedure

• Step-1- Visit any preferred bank.
• Step-2- Collect the application form and fill it in with details.
• Step-3- Submit the form along with other required documents (discussed below) to process the application.

The documents required for Kisan Credit Card include -

• Duly filled-in and signed-in application form
• Address proof document (Aadhaar card, ID, driving license, PAN card, voter ID)
• Identity proof (Aadhaar card, driving licence, PAN card, Voter ID, etc.)
• Land documents
• A passport-size photograph
• Other documents as requested by the issuing bank

Farmers willing to check Kisan Credit Card status can visit the CSC PM Kisan Credit Card portal and follow the process mentioned below,

• Step-1- Log on to the portal using CSC ID and the password and click on ‘View Status’.
• Step-2- A new webpage will open. Here, enter the Kisan Credit Card application ID.
• Step-3- Farmers can view application status.

• Kisan Credit Card Interest Rate: Depending on credit limit, the interest rates and charges on Kisan Credit Card vary from one bank to another. Usually, the interest rate ranges between 2%-4%. In certain cases, farmers can get subsidies on interest rates based on their repayment history, credit score.
• Kisan Credit Card Charges: Charges (processing fees, land mortgage deed charges etc.) of Kisan Credit Card differ from one bank to another.
• Kisan Credit Card Repayment Period: KCC scheme comes with a repayment period of 5 years

Here is a list of banks offering Kisan Credit Card -

• Axis Bank
• Bank of India
• HDFC Bank
• State Bank of India
• ICICI Bank
• Central Bank
• Union Bank of India