Kisan Credit Card: Avail Rs 5 Lakh Loan at Just 4% Interest – Check Eligibility, Documents, and Application Procedure
Enhanced Kisan Credit Card Limit
The Kisan Credit Card (KCC) scheme was introduced in 1998, initially offering a loan limit of Rs 1 lakh. Over time, this limit was increased to Rs 3 lakh. Now, in the Budget 2025, the government has raised the Kisan Credit Card loan limit to Rs 5 lakh, providing significant financial support to farmers.
Major Budget Announcement for Farmers
Finance Minister Nirmala Sitharaman has delivered great news for farmers in the latest budget. The Kisan Credit Card loan limit has been revised from Rs 3 lakh to Rs 5 lakh. This policy change will benefit millions of farmers across the nation. According to the Economic Survey 2024-25 presented in Parliament, the total number of Kisan Credit Cards (KCCs) issued in India by March 2024 stood at 7.75 crore. Additionally, loans worth Rs 9.81 lakh crore have been disbursed under the KCC scheme.
Overview of the Kisan Credit Card Scheme
The KCC scheme was initiated in 1998 based on recommendations from the National Bank for Agriculture and Rural Development (NABARD). This program has simplified the loan process, enabling farmers to easily access funds for purchasing seeds, fertilizers, pesticides, and other essential farming equipment. KCC plays a crucial role in providing timely financial assistance to farmers, helping them meet agricultural expenses effectively.
Interest Rate on Kisan Credit Card Loans
Previously, farmers could avail loans up to Rs 3 lakh under KCC, but the latest budget has increased this amount to Rs 5 lakh. The standard interest rate on KCC loans is 7% per annum. However, the government offers an interest subsidy to ease the financial burden on farmers. If the loan is repaid on time, an interest subsidy of 3% is granted, effectively reducing the interest rate to just 4%.
Eligibility for Kisan Credit Card
The benefits of the Kisan Credit Card scheme are extended not only to traditional farmers but also to those engaged in fisheries, dairy farming, animal husbandry, and horticulture. Specific eligibility criteria have been established, including Indian citizenship and an age range of 18 to 75 years.
Process for Obtaining a Kisan Credit Card
The procedure to obtain a Kisan Credit Card is straightforward. Farmers can apply through government banks, private banks, rural banks, and cooperative societies. Applications can be submitted both online and offline. To apply offline, farmers need to visit their nearest bank branch and submit the required documents, including an Aadhaar card, PAN card, land records, and passport-size photographs.
How to Apply Online
Farmers can also apply for a Kisan Credit Card through the PM Kisan Yojana website or the official website of their respective banks. Below are the step-by-step instructions for applying online through the State Bank of India (SBI):
Visit the official SBI website:
Navigate to the ‘Agriculture & Rural’ section.
Select ‘Crop Loan’ and then choose the ‘Kisan Credit Card’ option.
Download the application form, fill it out, and submit it.
Within 3-4 days, the bank will contact the applicant and initiate the Kisan Credit Card approval process.
Repayment and Loan Tenure
Kisan Credit Card loans are issued for a period of five years, after which they can be renewed. The farmer must pay interest twice a year and is required to repay the full loan amount along with interest annually. The principal amount can be withdrawn again the very next day after repayment. Farmers who follow this repayment schedule are eligible for the 3% interest subsidy. Failure to comply results in an interest charge of 7%. If payments are not made on time, the account may be classified as a Non-Performing Asset (NPA).
This initiative aims to provide financial stability to farmers, ensuring they have access to necessary funds while reducing their dependency on informal lending sources.
