Kisan Credit Card (KCC) Scheme: Easy Loans for Farmers – Process, Benefits, and Interest Rates

Kisan Credit Card Scheme

Krishi Dunia

• 02 Dec, 2025 01:15 PM IST ,
• Updated Tue, 02 Dec 2025 06:24 PM

The Kisan Credit Card (KCC) scheme was launched to provide farmers with timely and hassle-free access to credit. It offers financial support for crop-related expenses, purchase of equipment, seeds, harvesting, and livestock activities. Since its introduction in 1998–99, the scheme has become one of the most trusted financial tools for farmers across India.

What is the Kisan Credit Card Scheme?

The KCC scheme aims to provide farmers with quick and adequate loans through a simple process. Funds under this scheme can be used for:

• Crop production
• Purchase of agricultural equipment
• Fertilizers and seeds
• Irrigation and labor costs
• Other farming activities

Initiated jointly by the RBI and NABARD in 1998–99, millions of farmers have benefited from this scheme since its inception.

How to Apply for a Kisan Credit Card

Applying for a KCC is straightforward. Farmers can approach any public sector bank, regional rural bank, or cooperative bank in their area. Required documents typically include:

• Land details and ownership proof
• Identity proof (Aadhaar, Voter ID, etc.)
• Photographs
• Land record copy (Jot)

The bank evaluates the farmer’s land, cropping pattern, and income-expense profile to determine the loan limit. Once approved, the farmer receives a KCC passbook or a plastic card, which can be used like an ATM/debit card for easy withdrawals.

History of the Kisan Credit Card

The KCC scheme was introduced to reduce the hassle of applying for separate loans for each crop season. Previously, farmers had to submit multiple applications for different crops. With the KCC, a single card provides credit for all seasons.

The system has evolved over time. In 2012, NABARD and RBI upgraded it from a paper passbook to a plastic card, making transactions even more convenient.

Benefits of the Kisan Credit Card

The KCC offers several advantages for farmers, including:

• Quick and easy access to loans
• ATM/Debit card facility for on-demand withdrawals
• No processing fee for loans up to ₹3 lakh
• No collateral requirement for loans up to ₹1 lakh
• Annual loan limit increases by 10%
• Interest on KCC deposits comparable to savings accounts
• Crop insurance coverage under NAIS
• Loans up to ₹50,000 for Kharif and Rabi crops
• Financing for agricultural tools like sprayers, plows, and irrigation equipment

These features make KCC the most convenient and effective financial tool for farmers in India.

Interest Rate on Kisan Credit Card

• The standard interest rate is 7% per annum.
• Farmers who repay on time receive a 3% interest subsidy, reducing the effective rate to 4% per annum.
• This concession applies only to timely repayments.
• For larger loans, interest rates may vary as per bank policies.

How is the Loan Limit Determined?

• The initial loan limit is based on the farmer’s crop pattern and farming costs.
• The limit increases by 10% annually.
• After five years, the loan limit can grow to approximately 150% of the initial limit.

The loan can cover:

• Crop production costs
• Post-harvest expenses
• Agricultural equipment
• Insurance premiums
• Domestic and emergency farming needs

Who is Eligible for KCC?

• Land-owning farmers
• Tenant farmers
• Sharecroppers
• Oral leaseholders
• Self-Help Groups (SHGs)
• Joint liability groups
• All farmers within the bank’s operational area

KCC Card and Passbook System

The bank issues a card along with a passbook, which includes:

• Farmer’s name and address
• Land details
• Loan limit and validity
• Photograph

The card can be used for ATM and POS transactions, and annual renewal is mandatory.

Insurance Benefits

KCC holders automatically get coverage under the National Agricultural Insurance Scheme (NAIS). This provides financial relief in case of natural disasters such as drought, flood, or hailstorms, helping farmers mitigate losses effectively.