Kisan Credit Card amount crosses Rs 10 lakh crore, benefits 7.72 crore farmers

Showcasing credit deepening in agriculture and reduced dependency on non-institutional credit, the amount under operative Kisan Credit Card (KCC) accounts has more than doubled from Rs 4.26 lakh crore in March 2014 to Rs 10.05 lakh crore in December 2024, according to the latest government data.

As of December 31, a total of Rs 10.05 lakh crore has been given under operative KCCs, benefitting 7.72 crore farmers.

This indicates significant increase in quantum of affordable working capital loans provided to the farmers for agriculture and allied activities, said Ministry of Finance in a statement.

KCC is a banking product that provides farmers with timely and affordable credit for purchasing agricultural inputs such as seeds, fertilisers, and pesticides, as well as for meeting cash requirements related to crop production and allied activities.

In 2019, the KCC scheme was extended to cover the working capital requirements of allied activities — Animal Husbandry, Dairy and Fisheries.

The government, under the Modified Interest Subvention Scheme (MISS), provides interest subvention of 1.5 per cent to banks for providing short-term agri loans through KCC up to Rs 3 lakh at a concessional interest rate of 7 per cent per annum.

According to the ministry, an additional Prompt Repayment Incentive of 3 per cent is provided to farmers on timely repayment of loans, which effectively reduces the rate of interest to 4 per cent for farmers.

Loans up to Rs 2 lakh are extended on a collateral-free basis, ensuring hassle- free access to credit for small and marginal farmers, the ministry statement added.

The Union Budget 2025-26 has announced to increase the loan limit under the Modified Interest Subvention Scheme from Rs 3 lakh to Rs 5 lakh, which would further benefit the farmers.

There has been a six-fold increase in the allocation for agriculture in the Budget for 2025-26 to Rs 1,27,290 crore from the Rs 21,933.50 crore outlay in 2013-14 as a reflection of the increased government support for farmers under Prime Minister Narendra Modi-led government.