The Kisan Credit Card (KCC) is a government-backed credit facility designed to provide farmers with timely access to institutional finance. The scheme allows eligible farmers to obtain credit for cultivation and several agriculture-related requirements without going through a complicated borrowing process.
The KCC facility can be used for expenses such as seeds, fertilisers, crop production, irrigation, harvesting, post-harvest activities and other agricultural needs. The facility has also been extended to activities such as animal husbandry and fisheries for working-capital requirements.
What Is a Kisan Credit Card?
The Kisan Credit Card scheme provides farmers with a flexible credit facility through banks. The amount sanctioned is determined according to the farmer’s requirements, the scale of finance for the crop, cultivated area and other applicable factors.
The government announced an increase in the KCC loan limit under the Modified Interest Subvention Scheme from ₹3 lakh to ₹5 lakh. This higher limit applies to loans taken through KCC under the applicable scheme provisions.
The credit facility can support crop cultivation, purchase of agricultural inputs, post-harvest expenses, maintenance of farm assets and other agriculture and allied activities.
KCC Interest Rate and Repayment Benefit
Interest support is available on eligible short-term agriculture and allied-activity loans under the KCC framework. According to the Department of Financial Services, the government provides interest subvention of 1.5%, while an additional 3% incentive is available to farmers who repay their loans promptly. This can effectively bring the interest rate down to 4% on eligible loans, subject to the applicable conditions and limits.
Farmers should therefore check the applicable interest rate, loan limit and repayment conditions with their lending bank before taking the credit facility.
Who Can Apply for a Kisan Credit Card?
The KCC scheme covers a wide range of farmers. Eligible categories include owner cultivators, tenant farmers, oral lessees and sharecroppers. Self-Help Groups (SHGs) and Joint Liability Groups (JLGs) of farmers, including tenant farmers and sharecroppers, can also be covered under the scheme.
KCC facilities have also been extended to farmers involved in animal husbandry and fisheries for their working-capital requirements.
Collateral-Free Loan and Important Documents
The collateral-free limit for agricultural loans was increased by the RBI from ₹1.6 lakh to ₹2 lakh per borrower in December 2024. This change was intended to improve access to formal agricultural credit, particularly for small and marginal farmers.
The exact documentation and security requirements can depend on the lending institution and the type and amount of credit being sought. Applicants generally need to provide identity and address documents along with the KCC application and relevant land or farming-related records as required by the bank.
Farmers should contact the concerned bank or eligible lending institution to confirm the latest documents, credit limit, interest rate and other conditions before submitting an application.
Disclaimer
This article is for general informational purposes and is based on official government and RBI information available for the Kisan Credit Card scheme. Loan limits, interest benefits, collateral requirements, documentation and eligibility conditions may vary according to the applicable rules and lending institution. Farmers should confirm the latest terms directly with the concerned bank or authorised financial institution before applying.