Kisan Credit Card: The Reserve Bank of India (RBI) has put out a new draft aimed at changing the rules for the Kisan Credit Card (KCC) scheme. This draft is designed to offer more support to farmers, make the process easier, and adapt to the evolving needs of agriculture. RBI’s goal is to ensure that the KCC scheme reaches as many farmers as possible and that they receive the right loan amounts promptly. They’ve invited feedback from the public, banks, financial institutions, and other stakeholders on this draft until March 6, 2026. After that, the final rules will be established based on the feedback received.

Crop duration will be standardized

According to reports, the RBI has suggested standardizing crop season lengths to make the KCC loan approval and repayment process smoother. Right now, different regions have varying definitions of crop seasons, which can be confusing. Under the new proposal, crops that mature quickly will fall under a 12-month cycle, while those that take longer will be categorized in an 18-month cycle. This change will help farmers understand their loan repayment schedules better, and banks will be able to plan more effectively.

Proposal to increase the total tenure of KCC to six years

With long-term crops in mind, the RBI has proposed extending the total validity of Kisan Credit Cards to six years. This means farmers can benefit from this facility for a full six years. It will lessen the need for farmers to submit new applications repeatedly and provide ongoing financial support. This is particularly advantageous for those involved in horticulture or other long-term crops that require substantial investment and time.

Withdrawal limit will be as per actual cost

The draft also suggests that the withdrawal limit under KCC be determined based on the estimated cost of each crop season. Currently, farmers often receive less loan than they actually need, forcing them to make additional arrangements. Once the new system is implemented, loan limits will be determined based on the estimated cost of the crop. This will ensure farmers have adequate funds for seeds, fertilizers, pesticides, and other essential expenses.

Technical expenses will also be included

The RBI has also taken into account the growing technological needs in agriculture. According to the draft, expenses such as soil testing, real-time weather information, organic farming certification, and good agricultural practices certification will now be included in the eligible expenses under the KCC. However, these expenses will be kept within the 20 percent additional amount already provided for the maintenance and repair of agricultural assets. This means that farmers will also receive financial assistance in adopting new technologies, but within the total additional limit.

The governor had already announced

RBI Governor Sanjay Malhotra announced these changes in his monetary policy statement in February. Now, before implementation, they have been released as a draft to allow all stakeholders to provide their feedback. Overall, these RBI proposals are considered a major step toward making the KCC scheme more useful, transparent, and modern for farmers. If implemented, these changes will ensure farmers receive timely and tailored loans, strengthening the agricultural sector.

About the Author

Sweta Mitra

Working in the media for last 7 years. The journey started in the year 2018. For the past few years, my working experience has been in Bengali media. Currently working at Timesbull.com. Here I write like Business, National, and Utility News. My favorite hobbies are listening to music, traveling, food,...

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