Finance

Kisan Credit Card Process and Uses

The Kisan Credit Card is a Government of India launched the scheme, on the advice of R V Gupta Committee and National Bank For Agricultural And Rural Development (NABARD) for Indian farmers. It aimed to ensure affordable short-term credit to the farmers for cultivating crops, purchasing seeds, fertilizers, manures, and harvesting, besides maintaining the farms.

Usually, government schemes aim to fulfill more enormous credit requirements of farmers, but KCC helps them meet the day-to-day requirements in the form of short-term funds. The scheme also assures substantial financial assistance in the form of term loans.

Under this scheme, two types of financial help can be availed:-

Cash Credit–  Farmers use cash credit to buy seeds and fertilizers besides fulfilling other agricultural needs. A scheme is an appropriate option, providing short credit goals to the farmers. They can repay the approved amount later in the form of EMI’s.

Term Loans– Term loans can be availed to fulfill more considerable credit requirements such as purchasing equipment, cost of irrigation, etc. The terms and conditions differ from bank to bank, along with the amount of loan. The farmers may also need to pledge collateral in some cases to avail loans.

KCC Eligibility Criteria

  • Individual farmers and joint owners of agricultural land can apply for the PM Kisan Credit Card.
  • Farmers who do not own any land but work as tenants are also eligible to apply for Kisan Credit Card.
  • The land which is claimed by the farmer to avail of this scheme must be agricultural land and must be producing a crop.
  • The applicant must be between 18 to 60 years of age.

Benefits of KCC

Apart from providing short term funds and term loans, KCC can also be availed by the farmers to experience benefits like:-

  • Easy Credit Access– The applying process of KCC is simple and requires easy documentation. However, the submitted documents need to be revised seasonally.
  • Flexible Repayment Option– Farmers can easily repay their loans and cash credits through hassle-free repayment options. Farmers can opt to reschedule their date of repayment in case the harvested crops get destroyed by natural calamities.
  • Insurance Facility– KCC holders are eligible for insurance under National Crop Insurance Services for crop loans. They are also eligible to get insurance of Rs. 50,000 for death and permanent disability and Rs. 25,000 for other risk factors.
  • Broad Coverage– KCC scheme is eligible for farmers, sharecroppers, tenant farmers, people involved in animal husbandry, dairy farming, and fisheries. The only requirement is to produce a credit of Rs.5000 and more.

Documents Required

Here is a list of basic documents. It may vary from bank to bank.

  • Kisan Credit Card form filled by the individual.
  • Aadhar card, PAN Card, and other identity proofs of the applicant.
  • Address Proof highlighting the current residence status of the applicant.
  • Documents related to land ownership and tenant agreements.
  • Photographs (passport size) of the applicant.

How to Apply for a Kisan Credit Card online/offline?

Banks allow online applications to avail KCC. Here’s how you should apply online:-

  • Visit the bank’s website through which you are applying and go to the agricultural banking section.
  • Search for the Kisan Credit Card option and click on ‘Apply Now.
  • Fill the application form asking basic questions.
  • After this, the bank will give you a call and fix a date to collect documents.
  • Once the officials are done with the background check and they are satisfied with the submitted documents, a Kisan Credit Card will be issued under your name. 

Mostly, KCC is availed offline through farmers residing in remote locations.

In offline mode, individuals are required to visit the nearest bank and fill the application form in the bank itself. After a few days, the bank will communicate back, informing whether you are eligible for KCC or not based on the submitted documents.  If approved, you will get the KCC issued under your name delivered to your address. In rural areas, banks send marketing officers to find eligible KCC holders.  

Key Features of KCC Loan

  • The loan amount gets decided through different factors such as the size of the land, crops produced, estimated credit produced, borrower’s credit history, etc. After a few years, the amount can be increased and one can apply for higher loan amounts.
  • In some cases, Farmers may have to pledge collateral before taking loans. It entirely depends upon the bank and its scheduled loan policies. Some banks might even give you a loan without asking for collateral at all.
  • The repaying option is also decided by the lender keeping in mind the borrower’s financial capacity to pay back the amount. Term loans have different repaying tenure depending on factors like the borrower’s payback capability and his/her land.

KCC acts as a boon for farmers in India. It helps the farmers in meeting their daily agricultural requirements besides availing for short-term credits and term loans. The scheme has helped farmers in upgrading their agricultural produce and earn a decent living. Overall, the rural population has experienced a commendable up-gradation in their regular lifestyle. 

 

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