The Central Government has decided to continue the Modified Interest Subvention Scheme (MISS) till 2025-26 to provide relief to the farmers. This scheme provides short-term loans at affordable interest rates through Kisan Credit Card (KCC).
Under this scheme, eligible farmers can take a short-term loan up to Rs 3 lakh at 7% interest rate. The government gives interest subsidy of 1.5% to banks, so that farmers can get loans at lower interest rates.
If farmers repay their loans on time, they get an additional interest rebate of 3%. This means that for farmers who pay on time, the interest rate remains only 4%. This facility encourages farmers to repay the loan on time and maintain a good credit score.
Farmers taking Kisan Credit Card loan for animal husbandry or fish farming will get this interest benefit only on loans up to ₹ 2 lakh. This will promote small businesses in rural areas and increase the income of farmers.
The Union Cabinet has clarified that this time no changes have been made in the structure or other components of the scheme. At present there are more than 77.5 million Kisan Credit Card holders in the country, who will continue to get the benefit of interest subvention under this scheme.
The agricultural loan sector has grown significantly in the last few years. Institutional credit disbursement through Kisan Credit Card (KCC) was Rs 4.26 lakh crore in 2014, increasing to Rs 10.05 lakh crore by December 2024. The total agricultural loan flow is estimated to increase from Rs 7.3 lakh crore in 2013-14 to Rs 25.49 lakh crore in 2023-24.
Kisan Loan Portal, launched in August 2023, has made the loan disbursement and claim process more transparent and efficient. Through this digital platform, farmers have easy access to banking processes, and the interest subsidy is deposited directly into their accounts.
