The Reserve Bank of India (RBI) on Thursday said a platform for frictionless credit delivery through digital process used in Kisan Credit Card (KCC) will be made available for other loans to deepen financial inclusion. This will bring efficiency in the lending process in terms of reduction of costs, quicker disbursement, and scalability.
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KCC scheme helps farmers in purchasing agriculture products and services on credit at any time.
Here are the key things to know about the Kisan Credit Card (KCC) scheme:
Objective
The Kisan Credit Card scheme aims at providing adequate and timely credit support from the banking system under a single window with a flexible and simplified procedure to the farmers for their cultivation and other needs, according to the RBI statement.
Eligibility
Farmers—individual/joint borrowers who are owner cultivators, tenant farmers, oral lessees and share croppers; self-help groups (SHGs) or Joint Liability Groups (JLGs) of farmers including tenant farmers, share croppers etc can apply for KCC.
The borrower should be a minimum of 18 years of age and a maximum of 75 years. In the case of senior citizens, it is compulsory to have a co-borrower who is a legal heir.
Banks offerings
Many popular banks in India offer the Kisan Credit Card scheme such as the State Bank of India (SBI), HDFC Bank, ICICI Bank, Axis Bank, and Central Bank of India, among others.
Interest rate and charges
The interest rate on the KCC differs from one bank to another along with its credit limit. Other fees and charges such as processing fees, insurance premiums etc. are set at the discretion of the issuing bank.
| Banks offering Kisan Credit Card | Interest Rate |
| SBI Kisan Credit Card | Min. 7% p.a. |
| PNB Kisan Credit Card | Min. 7% p.a. |
| HDFC Bank Kisan Credit Card | Min. 9% p.a. |
| Axis Bank Kisan Credit Card | 8.85% p.a. | interest subvention provided |
| Mahabank Kisan Credit Card | Min. 7% p.a. |
| Indian Overseas Bank Kisan Credit Card | 7% p.a. | interest subvention provided |
| UCO Bank Kisan Credit Card | 7% p.a. | interest subvention provided |
(Source: Paisabazaar)
Repayment period
The repayment period may be fixed by banks as per the anticipated harvesting and marketing period for the crops for which the loan has been granted.
Normally, the term loan component is repayable within a period of 5 years depending on the type of activity/investment as per the existing guidelines applicable for investment credit, as per RBI norms.
Financing banks may, at their discretion, provide a longer repayment period for term loans depending on the type of investment.
Insurance
Eligible crops may be covered under 'Pradhan Mantri Fasal Bima Yojna' on premium payment. Borrowers should also opt for personal accident insurance and health insurance (wherever applicable).
Documents required
ID proof such as driving license/Aadhaar card/voter identity card, passport, etc is required. Also, proof of landholding duly certified by the revenue authorities, cropping pattern (crops grown) with acreage, security documents for loan limit, passport size photographs must be submitted.
Process to apply
Those looking to apply for KCC cards can apply online on the website of any bank that offers this facility. There should be a 'Kisan Credit Card' section under 'Cards'. Applicants are required to fill out the PM Kisan Credit Card online application form with the required details and submit.
Those looking to apply it offline, can download the application form, visit the nearest bank branch that offers the 'Kisan Credit Card' scheme and submit the filled up form.
First Published: Aug 10, 2023 3:42 PM IST
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