The recent announcement from the Minister of State for Fisheries, Animal Husbandry and Dairying has brought an expanded horizon in financial support for farmers as the provision of the Kisan Credit Card (KCC) expands its reach to fisheries and animal husbandry farmers. This strategic extension aims at providing ample support for their working capital requirements thereby elevating their business operations.
KCC Beneficiaries: Who Can Benefit?
The beneficiaries of this extended KCC scheme are diverse. It ranges from Fish, Poultry & Dairy Farmers (individual & groups/partners/sharecroppers/tenant farmers), Self Help Groups, Joint Liability Groups to Women groups. The key motive behind this expansion is to offer credit assistance for short term needs including rearing of animals, poultry birds, fish, shrimp, other aquatic organisms and capture of fish.
The Perks of KCC: Interest Subvention and More
The KCC facility offers a rewarding feature of interest subvention available for animal husbandry and fisheries farmers. This subvention allows farmers to avail an interest relief of 2% per annum at the time of disbursal of loan. There is also an additional interest subvention of 3 % per annum offered as a Prompt Repayment Incentive, designed for those who repay the loan within one year from the date of advance.
| Year | Key Activity |
|---|---|
| 1998 | Introduction of KCC scheme for timely credit support to farmers |
| 2004 | Extension of KCC scheme for investment credit requirement of farmers |
| 2006 | Introduction of Interest Subvention Scheme for farmers |
| 2022 | Extension of KCC scheme to fisheries and animal husbandry farmers |
Kisan Credit Card: The Genesis and Expansion
The journey of the Kisan Credit Card (KCC) began in 1998, with a noble mission to provide adequate and timely credit support from the banking system under a simplified procedure to the farmers. Farmers could then easily purchase agriculture inputs like seeds, fertilizers, pesticides etc. They could also draw cash for their production needs.
This provision was further expanded in 2004 to cater to the investment credit requirement of farmers for allied and non-farm activities. Today, KCC covers a broad spectrum of financial needs including post-harvest expenses, produce marketing loans, consumption requirements of farmer households, working capital for maintenance of farm assets and activities allied to agriculture as well as investment credit requirement for agriculture and allied activities.
The execution of the Kisan Credit Card Scheme is carried out by Commercial Banks, Regional Rural Banks (RRBs), Small Finance Banks and Cooperatives.
The Interest Subvention Scheme: Providing Relief to Farmers
The interest subvention scheme for farmers was introduced in 2006-07, implemented by NABARD and RBI. This scheme aims at easing the burden of short term credit for farmers by providing it at a subsidized interest rate. In scenarios where farmers are unable to repay the short term crop loan in the stipulated time, they can avail an interest subvention of 2%, as compared to the regular 5%. This scheme has played a substantial role in supporting the financial needs and uplifting the livelihoods of farmers across the country.
