Last updated on October 9th, 2023 at 01:02 pm
Kissan Credit Card(KCC) is a government supported credit facility provided to the farmers. KCC scheme provides rolling credit to the farmers and is easily accessible for the short term cash requirements of the farmer.
As per the recommendation of National Bank for Agriculture and Rural Development (NABARD) KCC scheme is introduced in India in 1998.
Read further for elaborate details on the scheme
What is KCC?
KCC is a credit facility provided to the farmers in which each borrower is provided with the Credit Card with a limit set based on the land holding and the requirement of the borrowers for the agricultural activity.
The repayment period of the credit facility is decided based on the crop cultivated and the harvesting period of the crop.
Thus farmer can utilize the limit of the credit card for the expenses towards the agricultural activities and can repay to the credit facilitator with the harvest.
Eligibility
The following people are eligible to apply for Kisan Credit Card
- Farmers – The objective of the scheme is to help the farmers to reach easy credit facility to meet the fund required for cultivation.
- Agricultural and Other Related Activities – KCC is also provided to the people who are directly and Indirectly involved in Agricultural activities like Fisheries and Animal Husbandry, Poultry and Diary.
- Self Help Group (SHG) and Joint Liability Groups (JLG)- SHG and JLG’s are as per Government instruction are eligible for KCC cards.
KCC can be availed only in one institution. Thus if you have availed short term finance from one bank/ Coop society you can not apply for the KCC with the different bank for the same land.
How to Apply for KCC?
KCC is a Credit/Loan facility available with all the commercial banks and Agriculture Co operative Societies.
Thus if you are qualified for the KCC and comply with the eligibility norms, You can visit the nearest branch of commercial bank or Cooperative societies.
Alternatively you can apply online through the official website of the bank or co op societies.
The application also available in PM Kisan portal for the farmers who are the beneficiary of PM Kisan Fund.
You can Submit the application duly filled along with the following documents to the bank.
- Application duly filled with the correct details
- Aadhar Card photocopy.
- Recent photograph of the applicant
- Proff of Land details for the crop cultivation.
- Declaration on the consumption required for the cultivation.
With the all the documents in place the banks will decide on accepting your loan application based on the agricultural activity you are proposing and your credit history.
Upon approving your application banks will sanction the credit facility and issue Credit Card with your name printed on it.
KCC borrowers also provided with the Passbook/ Acknowledgement with the account number, Your Name and the Limit provided.
Features of KCC
KCC is similar to the working capital Loan provided to the business entities. It fulfills the short term cash requirement of the former during cultivation and the post harvest expenses.
Kisan Card apart from helping farmers also covers Fisheries, Fish Farmers, SHG and JLG.
Credit Limit
The Credit Limit provided to the Farmer is decided based on the following factors
- Capital Requirement towards cultivation
- Ancillary Activities towards the cultivation like Maintenance of Agricultural Machinery and Electricity Supply, etc.
The maximum limit that can be provided under KCC is Rs. 3 Lakh per year with Subvention.
Limit up to Rs. 1.6 Lakh does not requires any collateral security. Though there should be a suitable collateral security available for limits above Rs. 1.6 Lakh.
Interest Subvention
Central Government is providing subvention of 2% on the Interest paid towards the KCC account. Also 3% subvention for the prompt payment before due date by the farmer.
But note that the Interest subvention would not be provided for the Maintenance portion of the capital requirement.
Thus farmers are getting Net Interest Rate as low as 4% per Annum.
KCC Working Capital Term
The maximum period of working capital requirement is calculated based on the cycle of the activity and production cycle.
For the Agriculture KCC is provided for 12 months except for several long term Crops like Sugarcane and Banana which has a harvest period of 18 to 24 months.
Revolving Credit Facility
KCC provides easily available revolving credit facility to the farmers. Thus they can withdraw and deposit money into the KCC account any number of times.
This will help the farmers plan the expenses and also reduce the interest accumulation for the period they are not in need of money.
Insurance Facility
Banks upon sanctioning KCC will also insure your crop against natural calamities through PMFBY. If you want to do it yourself, you can inform the bank and you can do the crop insruance yourself.
Also as per the instruction of the central government Rupay KCC card comes with the personal accidental cover of Rs. 2 Lakh.
Conclusion
Kisan Credit Card is a scheme specifically hand crafted for the farmers by NABARD. Now the facility is available to various activities and people from different sector helping millions of people.
The KCC facility is a grace option for the people who does only have access to the short term fund with the private lenders.
KCC comes with easy accessibility, less paper work and comes with the reasonable interest rate. Thus helping farmers in timely manner and also protecting them from unorganized borrowing.