SRINAGAR: The Government of India has increased the Kisan Credit Card (KCC) loan limit to Rs 5 lakh under the Modified Interest Subvention Scheme. This enhancement, announced in the Union Budget for 2025-26, applies to all beneficiaries of the KCC scheme, including crop cultivators, dairy farmers, and those engaged in fisheries and animal husbandry.
According to details presented in the Lok Sabha by the Ministry of Fisheries, Animal Husbandry and Dairying, the KCC scheme, originally designed for crop loans, was extended to fisheries and animal husbandry in 2018-19 to cover working capital needs. Farmers can now avail themselves of loans up to Rs 5 lakh at concessional interest rates for activities such as crop cultivation, livestock rearing, fish farming, and post-harvest operations. Additionally, the government has increased the collateral-free loan limit from Rs 1.6 lakh to Rs 2 lakh, effective from January 1, 2025, as per a Reserve Bank of India (RBI) circular issued on December 6, 2024.
The scheme continues to offer interest subvention benefits, with farmers receiving loans at a subsidised interest rate of 7 per cent. Those who make timely repayments are eligible for a 3 per cent prompt repayment incentive, effectively reducing their interest burden to 4 per cent per annum for loans up to Rs 2 lakh
The expansion of KCC benefits is expected to improve credit accessibility for millions of farmers, ensuring better financial support for agricultural activities.
