Kisan Credit Card: Providing significant relief to millions of farmers across the country, the Central Government has approved the continuation of the Modified Interest Subvention Scheme (MISS) until 2025-26. This scheme is a central sector scheme aimed at providing short-term loans to farmers at affordable interest rates through Kisan Credit Cards (KCC).
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Affordable loan facility continues through Kisan Credit Cards
Under this scheme, eligible farmers can avail short-term loans up to ₹3 lakh at an interest rate of 7% through Kisan Credit Cards. The government provides an interest subsidy of 1.5% to banks to ensure they can provide loans to farmers at a lower interest rate.
The interest rate is reduced to 4% if repayments are made on time
Farmers receive an additional 3% interest rebate if they repay their loans on time. This means that for farmers who make timely payments, the interest rate is reduced to just 4 percent. This facility encourages farmers to repay their loans on time and maintain a strong credit score.
Separate provisions for animal husbandry and fisheries farmers
Farmers who take out Kisan Credit Card loans for animal husbandry or fisheries will receive this interest benefit only on loans up to ₹2 lakh. This will also encourage small businesses like animal husbandry and fisheries in rural areas and increase farmers’ income.
No change in the scheme
The Union Cabinet has clarified that no changes have been made to the structure or any other component of the scheme this time. There are currently over 77.5 million Kisan Credit Card holders in the country, who will continue to benefit from the interest rebate under this scheme.
Rapid increase in agricultural credit
There has been significant growth in the agricultural credit sector in the last few years. Institutional credit disbursements through Kisan Credit Cards (KCCs) were ₹4.26 lakh crore in 2014, increasing to ₹10.05 lakh crore by December 2024. Total agricultural credit flow is projected to increase from ₹7.3 lakh crore in 2013-14 to ₹25.49 lakh crore in 2023-24.
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Increased Transparency with Digital Portal
The Kisan Loan Portal, launched in August 2023, has made the loan disbursement and claims process more transparent and efficient. With this digital platform, farmers now have easier access to banking processes, and the benefit of interest subsidies is directly credited to their accounts.