The Reserve Bank of India issued the final revised Kisan Credit Card framework on 19 June 2026; the directions take effect from 1 January 2027.
Key changes
- Crop-season standardisation: 12 months for short-duration crops and 18 months for long-duration crops; aligned with Income Recognition and Asset Classification (IRAC) norms.
- Scope: Applies to working capital and investment credit for agriculture and allied activities.
Collateral and lending limits
- Collateral-free limit: Banks shall waive collateral security and margin for agricultural loans up to ₹2 lakh per borrower.
- Hypothecation exception: For loans against hypothecation of crops/stock with recovery tie-ups, collateral may be waived up to ₹3 lakh.
- Voluntary pledging: Pledging gold or silver voluntarily within the ₹2 lakh limit will not constitute a guideline violation.
- RBI position: Suggestions to raise the collateral-free threshold were declined; the limit was recently enhanced in December 2024.
Flexi KCC for marginal farmers
- Flexible limit: Marginal farmers eligible for a Flexi KCC of ₹10,000–₹50,000 as per bank assessment; eligibility not tied to land value.
Transitional provision
- Existing loans: KCCs sanctioned before 1 January 2027 remain governed by prior guidelines until maturity or next renewal.
IASPOINT Booster Facts
- Regulatory basis: RBI issues operational directions to banks; alignment with IRAC affects NPA recognition timelines.
- Coverage note: Allied activities (fisheries, livestock, forestry, agro-processing) included within KCC framework.