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We have a keen belief in- “The future of Agriculture, with a faith born not of words but of deeds & development…”
Due to the current-going Farmer protest (2020-2021), one thing has proved that this is such a sensitive and significant subject of discussion for both- the Farmers and the Government as well.
As a gesture of honor, respect, empowerment, and contribution to the nation, the Government launched a scheme for Kisan (Farmers) KISAN CREDIT CARD, keeping all the measures in mind.
Start reading…

An Introduction to Kisan Credit Card (KCC Scheme)

Kisan Credit Card Scheme aims at providing adequate and on-time financial help or you can say credit support to the farmers under the proper banking system; in order to fulfill their cultivation & other needs. Like others or us, our respective bank issues a credit card for our financial support for our need hour; just like- farmers with Kisan Credit Card, allow them to avail many benefits like purchasing pesticides, produce marketing loan, future investment credit requirements, etc.

Key Features & Benefits of Kisan Credit Card

• Farmers are given credit for meeting their financial requirements of agricultural and other allied activities along with post-harvest expenses.
• Investment credit for agricultural requirements such as dairy animals, pump sets etc.
• Farmers can take out a loan of up to Rs.3 lakh and also avail produce marketing loans.
• Insurance coverage for KCC scheme holders up to Rs.50,000 in the case of permanent disability or death. A cover of Rs.25,000 is given in the case of other risks.
• Eligible farmers will be issued a savings account with attractive interest rate along with smart card and a debit card in addition to the Kisan Credit Card.
• Flexible repayment options and hassle-free disbursement procedure.
• Single credit facility/ term loan for all agricultural and ancillary requirements.
• Assistance in the purchase of fertilizers, seeds, etc. as well as in availing cash discounts from merchants/ dealers.
• Credit is available for a period of up to 3 years and repayment can be made once the harvest season in over.
• No collateral is necessary for loans amounting up to Rs.1.60 lakh.

How Kisan Credit Card Scheme came into existence?

Kisan Credit Card Scheme or Kisan Credit Card Loan Scheme was initiated in 1998 by Government’s section NABARD (National Bank for Agriculture and Rural Development). The Kisan Credit Card Scheme was further extended in 2004, for the investment credit requirement of farmers viz. allied and non-farm activities.
The Kisan Credit Card has emerged as an innovative credit delivery mechanism to meet the production credit requirements of the farmers in a timely and hassle-free manner. The GOI (Government of India), Ministry of Finance constituted a Working Group under the chairmanship of Shri T M Bhasin, Chairman & Managing,

Indian Bank to review the KCC Scheme. Based on the recommendations of the Working Group which were accepted by the GOI, the revised KCC Scheme is effective from 12 May 2012.

In the Budget 2018-19, the Union Government had announced their decision to extend the facilities of Kisan Credit Card (KCC) to Animal Husbandry farmers and Fisheries (AH & F) to help them meet their working capital requirements. The revised KCC Scheme is to be Implemented by Commercial Banks, RRBs, and cooperatives.

Kisan Credit Card Scheme- What Farmers can Avail?

KCC can be used for the following:

• To fulfil the short-term credit requirements for cultivation of crops
• Post-harvest expenses
• Produce Marketing loans
• Consumption requirements of farmer household
• Working capital to maintain farm assets and activities allied to agriculture, like dairy animals, inland fishery, etc.
• Investment credit requirement for agriculture and allied activities like pump sets, sprayers, dairy animals, etc.

The above-mentioned benefits are categorized under two types of forms for attaining the Kisan Credit Card-

• Short-term credit limit portion- for the above five bullets
• Long-term credit limit portion- for investment credit requirement

Who are Eligible for Kisan Credit Card Scheme?

1. All Farmers – Individuals / Joint borrowers who are owner cultivators;
2. Tenant Farmers, Oral Lessees & Share Croppers;
3. SHGs or Joint Liability Groups of Farmers including tenant farmers, share croppers etc.

More detailed

• Any individual farmer who is an owner-cultivator
• People who belong to a group and are joint borrowers. The group has to be owner-cultivators.
• Sharecroppers, tenant farmers, or an oral lessee are eligible for the KCC.
• Self-help groups (SHG) or joint liability groups (JLG) of sharecroppers, farmers, tenant farmers, etc.
• Farmers involved in the production of crop or allied activities such as animal husbandry along with non-farm activities such as fishermen.

Eligible Fisheries under the KCC Scheme

• Dairy- Farmers, dairy farmers, SHGs, JLGs, and tenant farmers who own lease, or rent sheds.
• Poultry- Individual farmers or joint borrowers, SHGs, JLGs, and tenant farmers of sheep, rabbits, goats, pigs, birds, poultry, and have sheds they have owned, rented, or leased
• Inland Fisheries and Aquaculture: Fish farmers, fishers, SHGs, JLGs, and women groups. As a beneficiary, you must own or lease any activity related to fisheries. This includes owning or leasing a pond, an open water body, a tank, or a hatchery among others
• Marine Fisheries: You own a registered boat or any other type of fishing vessel and you have the necessary license or permissions for fishing in estuaries or the sea

Document required to Apply for Kisan Credit Card (KCC) Loan Scheme

In order to apply for anything in this entire globe, paperwork should be quite strong. For Kisan Credit Card Loan Scheme, the following documents are necessary-

1. Duly filled-in and signed-in application form
2. Copy of identity proof such as Aadhaar card, PAN card, Voter ID, driving license, etc.
3. Copy of address proof document such as Aadhaar card, PAN card, Voter ID, driving license. The proof should have the applicant’s current address to become valid
4. Land documents
5. A passport size photograph of the applicant
6. Other documents such as security PDC as requested by the issuing bank

Top Kisan Credit Card Banks

Application Process for Kisan Credit Card

Eligible people can easily apply for Kisan Credit Card in two ways- Online or Offline.
Here, in this section we are going to introduce with both the ways of Kisan Credit Card Application. Have a look-

Online

• Visit the website of the bank you wish to apply for the KCC scheme
• From the list of options, choose the Kisan Credit Card
• On clicking the option of ‘Apply’, the website will redirect you to the application page
• Fill the form with the required details and click on ‘Submit’
• On doing so, an application reference number will be sent
• If you are eligible, the bank will get back to you for the further process within 3-4 working days

Offline

• Offline applications can be done by visiting the branch of the bank of your choice or by downloading the application form from the website of the bank as well.
• The applicant can visit the branch and begin the application process with the help of the bank representative.
• Once the formalities are done, the bank’s loan officer can help with the loan amount for the farmer

Fixation of Credit Limit/Loan Amount

The credit limit under the Kisan Credit Card may be fixed as under:

For Marginal Farmers

A flexible limit of Rs.10,000 to Rs.50,000 be provided (as Flexi KCC) based on the land holding and crops grown including post-harvest warehouse storage related credit needs and other farm expenses, consumption needs, etc. Plus small term loan investments like purchase of farm equipment, establishing mini dairy/backyard poultry as per assessment of Branch Manager without relating it to the value of land. The composite KCC limit is to be fixed for a period of five years on this basis. Wherever higher limit is necessaryy due to change in cropping pattern and/or scale of finance, the limit may be as per the estimation.

All farmers other than marginal farmers

Limit is arrived as per scale of finance. The short-term limit to arrive for the first year: Scale of finance for the crop (as decided by District Level Technical Committee) x Extent of area cultivated + 10% of limit towards post-harvest / household/consumption requirements + 20% of limit towards repairs and maintenance expenses of farm assets + crop insurance, PAIS & asset insurance.

KCC Loan Repayment Limit

Most of the banks in India which offer the Kisan Credit Card (KCC) loans are looking for a longer loan repayment tenure for the loans. This has been suggested as the agriculture sector is under significant pressure. The cycle of the loans provided under the Kisan Credit Card scheme has been proposed to be increased to 36 or 48 months from the 12 months. This was proposed at the state-level bankers’ consultancy meet in West Bengal.

In addition to the enhancement of the loan repayment tenure, the banks have also proposed that the farmers should be allowed to avail extra loans even after failing to repay the previous loan. However, in order to do that, they should service the interest. Public sector banks have started a 3-stage consultation process recently on the basis of the directions passed by the Department of Financial Services.

The main focus of the consultation process would be to discuss 9 important issues. These include credit offered to MSMEs and agriculture sectors, digital banking, direct transfer of benefits, and education loans. The previous meeting was an intra-bank meet. However, this time the meeting will be an inter-bank meet at a state level.

What is PM Kisan Samman Nidhi Scheme and How to Apply for it?

Indian Government has launched the Pradhan Mantri Kisan Samman Nidhi; under which, all farmers can avail up to Rs. 6,000 every year as their income support. The Government announced this scheme during the 2019 Union Budget of India.
Post the release of Budget 2020, the government is now making sure that institutional credit is more accessible to all farmers of our country. This is being done by bringing together the Kisan Credit Card (KCC) Scheme and the Kisan Samman Nidhi Scheme. All beneficiaries under the Kisan Samman Nidhi Scheme can now get a Kisan Credit Card.

Apply

If you want to apply for a KCC Loan Scheme under the PM Kisan Samman Nidhi Scheme, you can follow these steps:

• You have to fill a one-page form which, is available on the website of all commercial banks
• Fill in all your basic information like crop is sown and land record
• Submit this form to the Common Service Centres (CSC) and they will transfer the forms to all banks

Electronic Kisan Credit Cards (ATM)

• Banks will issue ATM card for all KCC accounts. Go through the following vital ATM card-related information-
• All new KCC must be issued as smart card cum debit card as laid down in Policy.
• Further, at the time of renewal of existing KCC, farmers must be issued smart card cum debit card.
• The short-term credit limit and the term loan limit are two distinct components of the aggregate KCC limit bearing different rates of interest and repayment periods.
• Until a composite card could be issued with appropriate software to separately account transactions in the sub-limits, two separate electronic cards may be issued for all new/renewed cards.

Disbursement

ATM card must be issued in all KCC accounts. The short-term component of the KCC limit is in the nature of revolving cash credit facility. There should be no restriction in number of debits and credits. However, each installment of the drawable limit drawn in a particular year will have to be repaid within 12 months. The drawing limit for the current season/year could be allowed to be drawn using any of the following delivery channels.

1. Operations through the branch;
2. Operations using Cheque facility;
3. Withdrawal through ATM / Debit cards;
4. Operations through Business Correspondents and ultra-small branches;

To be introduced as early as possible so as to reduce transaction costs of both the bank as well as the farmer.

• Operation through PoS available in Sugar Mills/ Contract farming companies, etc., especially for tie-up advances;
• Operations through PoS available with input dealers;
• Mobile-based transfer transactions at agricultural input dealers and mandies

Epilogue- A Summary of all

The KCC scheme was introduced to ensure that the credit requirements for farmers in the agriculture, fisheries and animal husbandry sector were being met. This was done by helping them avail short-term loans and provide them with a credit limit to purchase equipment and for their other expenses as well.
Moreover, with the help of KCC, farmers are exempt from the high interest rates of the regular loans offered by banks as the interest rate for KCC starts as low as 2% and averages at 4%. With the help of this scheme, farmers can repay their loans depending on the harvesting period of their crop for which the loan was given.

Any queries? Call on Customer care- Toll-free number, 155261 / 1800115526 or reach 0120-6025109 to raise any concerns regarding the Kisan Credit Card scheme.
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