Govt Considers Raising Kisan Credit Card Loan Limits

Big news for farmers! The government is considering major changes to boost financial support for the agricultural sector. Here’s what you need to know:

Higher Limits for Kisan Credit Card (KCC) Loans:

  • Planned Increase: The government is working to raise the credit limit on Kisan Credit Card (KCC) loans, which has remained unchanged for the past 3-4 years.
  • Current Limit: Currently, the maximum credit limit under the KCC scheme is ₹3 lakh.
  • Outstanding Credit: As of now, the outstanding credit in KCC accounts stands at a whopping ₹9.81 lakh crore!
  • Interest Subsidy: Farmers can benefit from a subsidized interest rate of 4% per annum, thanks to a 2% interest subvention and an additional 3% Prompt Repayment Incentive.

RBI’s Modified Interest Subvention Scheme:

  • Interest Rate: Eligible farmers can access loans up to ₹3 lakh at a subsidized interest rate of 7%.
  • Prompt Repayment Bonus: Farmers who repay their loans on time will receive an additional interest subvention of 3% per annum.
  • Aadhaar Linkage: Mandatory Aadhaar linkage will continue to be required for accessing these loans.

New Scheme for Tenant Farmers:

  • PM-SVANidhi-Type Scheme: Inspired by the success of the PM Street Vendor’s Atmanirbhar Nidhi (PM-SVANidhi) for street vendors, the government is considering a similar scheme tailored for tenant farmers.
  • Improved Farm Credit Mechanism: This initiative aims to provide better financial support to tenant farmers, ensuring they have access to necessary funds.