Budget 2025: Finance Minister Nirmala Sitharaman announced an increase in the interest subvention scheme for the Kisan Credit Card (KCC), raising the limit from Rs 3 lakh to Rs 5 lakh.
Presenting the eighth consecutive Budget today, Sitharaman said, "Kisan Credit Card facilitates short-term loans for 7.7 crore farmers, fishermen and dairy farmers. The loan limit under modified interest subvention scheme will be enhanced from Rs 3 lakh to Rs 5 lakh for loans taken through the KCC. For self-reliance in urea production, our govt had reopened three dormant urea plans in the eastern region to further augment urea supply - a plant with an annual capacity of 12.7 lakh metro tonnes will be set up at Namrup in Assam."
What is Kisan Credit Card?
Kisan Credit Card (KCC) is one of the most popular schemes among farmers. Introduced in 1998, the KCC scheme aims to simplify the loan process for farmers. Under this scheme, loans are provided for agricultural activities at an affordable interest rate of just 4 per cent. The minimum age for applicants is 18 years, and there is no upper age limit. A maximum loan of up to Rs 3 lakh can be taken under this scheme, with a maximum loan tenure of 5 years. The validity of the Kisan Credit Card is also five years.
To apply for a Kisan Credit Card, farmers must meet certain eligibility criteria, such as being an owner-cultivator, sharecropper, tenant farmer, or a member of a self-help group or joint liability group. They must also be involved in the production of crops or allied activities such as animal husbandry, or non-farm activities like fishing. Earlier, loans above Rs Rs 1.60 lakh required a guarantee. Recently, the Reserve Bank of India (RBI) increased the guarantee-free loan limit to Rs 2 lakh. This means loans up to Rs 2 lakh can now be availed without any collateral.