Kisan Credit Card: A Relief to all Farmers for their Agricultural Needs

In order to look after the agricultural needs of the farmers such as timely availability of funds for fulfilling their cultivation, farm maintenance, and investment needs—Kisan Credit card brought under purview by Indian banks which was introduced in August 1998. This model scheme was prepared by the National Bank for Agriculture and Rural Development(NABARD) following the directives of R.V Gupta for providing term loans and agricultural needs.

Kisan credit card schemes focus on reducing the dependence of farmers on the informal banking sector for credit-which can prove very costly and trap them into a debt spiral. The card is provided by cooperative banks, regional rural banks, and public sector banks. Depending on a review of the working of the KCC, the government has suggested the banks to convert the KCC into a smart card cum debit card.

Features of Kisan Credit Card

• All the categories of farmers whether small and marginal farmers, share croppers and tenants are entitled to apply for the Kisan Credit Card.

• It makes the screening and credit delivery process easier for those farmers who don't know anything about the banking procedures and practices. It gives you one-time documentation and all successive documentation is dependent on the farmer's declaration of crops to be raised etc.

• It makes the multi-layered credit assessment process easier for urban focussed credit schemes. The credit limit is dependent on the criteria like land holding, income and credit history of the farmer.

• The Kisan Credit Card scheme provides quick and timely credit facility because of the simplified documentation and screening procedure.

• The Kisan Credit Card provides flexible repayment option after the harvest season and allows restructuring of payments in case of a bad crop season.

• Farmers can avail it for making cash withdrawals or for obtaining loans.

• The Kisan Credit Card is now integrated with a Savings bank account so that any farmer can have only a single account. The farmers will earn interest if there is any credit balance in the account.

• The farmers may get an insurance coverage under KCC scheme.

• It provides a single credit provision for the farmers for all their agricultural needs.

Eligibility of Kisan Credit Card

The following individuals are eligible to apply for Kisan Credit Card:

• All farmers -individuals/Joint borrowers who are owner-cultivators.

• The minimum age for availing Kisan Credit Card is 18 years and the maximum age limit is 75 years at the end of the loan tenure.

• The borrowers whose age is above 60 years needs to compulsorily include a co-borrower whose age should be less than 60 years. The co-borrower should be a legal heir/immediate family member.

• The joint holding (single or multiple locations) upto 5 years is allowed.

• Tenant Farmers, Oral Lessees & Share Croppers are eligible to avail Kisan credit card.

• SHGs or Joint Liability Groups of farmers including tenant farmers, share croppers etc. are eligible to avail Kisan Credit Card.

Interest Rate on Kisan Credit Card

As per RBI directives, the banks levy lower than normal interest rates for the Kisan Credit Card. It is seen generally that different banks charge different interest rates, with the average being around 9%. Basically, the maximum credit limit is ₹ 3 lakh. Those farmers who earn good credit scores get subsidies on the interest rates and even higher limits on their credit.

Kisan Credit Card Documents Required

•  Duly filled in application form

• Identity proof- Voter ID card/PAN card/Passport/ Aadhaar card,/Driving License etc

• Address proof- Voter ID card/Passport/Aadhaar card/Driving license etc

Top Banks Providing Kisan Credit Card in India

NABARD: NABARD provides term loans and quick availability of credit card to farmers in order to fulfill their basic agricultural expenses.

SBI : The short-term credit is provided by SBI to farmers with an objective for fulfilling the production credit requirements, expenses covering allied activities along with contingency expenses.

Bank of India : Bank of India offers convenient financial aid to farmers for helping them out to meet their expenses involved in cultivation and other non-farm activities at a lower cost.

IDBI : IDBI provides Kisan Credit Card to farmers along with extra features like investment credit, crop loans, and working capital so as to meet their agricultural expenses. Farmers, owner cultivators, tenant cultivators, individual farmers, and sharecroppers are eligible to avail the Kisan Credit Card.

Axis Bank : Axis Bank offers Kisan Credit Card for meeting timely credit of farmers like purchase of inputs, investment needs like the purchase of agricultural implements, land development, repair of farm machinery or any other needs including domestic needs like expenditure on account of children's education and family functions, etc.

ICICI Bank : ICICI Bank offers Kisan Credit Card for meeting both short-term and long-term credit requirements of the farmers. It also covers their day-to-day farming needs.