Kisan Credit Card (kcc) And Crop Loaning System 6o81k

Kisan Credit Card (KCC) and Crop Loaning System

Salient features of the KCC Scheme • Farmers to be provided with a KCC and a book or card-cum- book. • Revolving cash credit facility. • Limit on the basis of operational land holding, cropping pattern and scale of finance. • Limit for entire production credit needs for full year plus ancillary activities related to crop production. • Card valid for 3-5 years subject to annual review. • Withdrawals through slips/cheques accompanied by card and book.

Salient features contd..... • Each drawal to be repaid within 12 months. • Conversion/reschedulement of loans in case of damage to crops due to natural calamities. • Security, margin, rate of interest, etc. as per RBI norms.

• Operations may be through issuing branch and also through other designated branches at the discretion of bank. • KCC loans for notified crops covered under RKBY.

Revised KCC Scheme

Objectives/Purpose • Adequate and timely credit • Single window for cultivation & other needs  Short term credit for cultivation of crops

 Post harvest expenses  Produce Marketing loan  Consumption requirements of farmer household

 Working capital for maintenance of farm assets  Investment credit for agriculture and allied activities

Eligibility • All Farmers – Individuals / t borrowers • Tenant Farmers, Oral Lessees & Share Croppers • SHGs or t Liability Groups of Farmers including tenant farmers, share croppers etc.

Fixation of Maximum Permissible Limit • Short Term Limit at the end of the validity period • Term Loan Component

Fixation of ST credit limit (Farmers other than MF) • First Year  Scale of finance x Extent of area cultivated

 + 10% of limit towards post-harvest / household / consumption requirements  + 20% of limit towards repairs and maintenance expenses of farm assets  + crop insurance, PAIS & asset insurance.

ST credit limit contd…. (Farmers other than MF)

• Second & subsequent years • Previous year limit plus 10% of increase towards cost escalation for every successive year ( 2nd, 3rd, 4th & 5th year) • In case the cropping pattern adopted by the farmer is changed in the subsequent year, the limit may be reworked • In case the revision of scale of finance for any year exceeds the notional hike of 10%, a revised limit may be fixed

Disbursement • Short term component of the KCC limit • Revolving cash credit facility • Drawals as per convenience of farmer

• No restriction in number of debits and credits

• Term loan component • Installments withdrawn based on nature of investment and repayment schedule drawn as per the economic life of the proposed investments

Marginal Farmers • A flexible limit of Rs.10,000 to Rs.50,000 (as Flexi KCC) based on:

• land holding and crops grown • post harvest warehouse storage related credit needs and other farm expenses,

• consumption needs, etc., • small term loan investments • establishing mini dairy/backyard poultry

Validity & Documentation • Validity period to be decided by the bank. • Annual review.

• Margin to be decided by the bank. • One time documentation at the time of first availment and simple declaration thereafter. • Processing fee to be decided by the banks.

Repayment & NPA Classification • Repayment period as per anticipated harvesting and maturity period of the crops. • Term loan component: Normally repayable within a period of 5 years depending on the type of activity / investment. • Financing banks at their discretion, may provide longer repayment period for term loan. • Extant prudential norms for income recognition, asset-classification and provisioning will apply.

Security • Hypothecation of crops up to card limit of Rs. 1.00 lakh • With tie-up for recovery: Banks may consider sanctioning loans on hypothecation of crops upto card limit of Rs.3.00 lakh • Collateral security at the discretion of Bank for loan limits above Rs.1.00 lakh in case of non tie-up and above Rs.3.00 lakh in case of tie-up advances • Banks to ensure on-line creation of charge on the land records in States where facility available

Other Features • Interest Subvention/Incentive by GoI and / or State Govt. • Mandatory Crop Insurance and PAIS. • Farmer to have option to take benefit of Assets Insurance & Health Insurance (wherever product is available). • facility of all insurance premia paid through KCC . • KCC Short Term sub-limit cum SB • Separate electronic card for ST & long term sub-limits until both the sub-limits are integrated through an electronic card with suitable software.

Delivery Channels • • • • •

Through branch Using Cheque facility Through ATM / Debit cards Through BCs and Ultra Small Branches Through PoS available in Sugar Mills/ Contract farming companies, etc., • Through PoS available with input dealers • Mobile based transfer transactions at agricultural input dealers and mandies

Thank You