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Objectives-
As
a pioneering credit delivery innovation, Kisan Credit Card Scheme aims
at provision of adequate and timely support from the banking system
to the farmers for their cultivation needs including purchase of inputs
in a flexible and cost effective manner.
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Contents
of Credit Card-
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Beneficiaries
covered under the Scheme are issued with a credit card and a pass
book or a credit card cum pass book incorporating the name, address,
particulars of land holding, borrowing limit, validity period, a passport
size photograph of holder etc., which may serve both as an identity
card and facilitate recording of transactions on an ongoing basis.
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Borrower
is required to produce the card cum pass book whenever he/she operates
the account.
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Salient
features of the Kisan Credit Card (KCC) Scheme
- Eligible
farmers to be provided with a Kisan Credit Card and a pass book or card-cum-pass
book.
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Revolving cash credit facility involving any number of drawals and repayments
within the limit.
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Limit to be fixed on the basis of operational land holding, cropping
pattern and scale of finance. Entire production credit needs for full
year plus ancillary activities related to crop production to be considered
while fixing limit.
- Sub-limits
may be fixed at the discretion of banks
- Card
valid for 3 years subject to annual review. As incentive for good performance,
credit limits could be enhanced to take care of increase in costs, change
in cropping pattern, etc.
- Each
drawal to be repaid within a maximum period of 12 months.
- Conversion/reschedulement
of loans also permissible 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 PACS in the case of Cooperative
Banks) through other designated branches at the discretion of bank.
- Withdrawals
through slips/cheques accompanied by card and passbook.
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Advantages
of the Kisan Credit Card Scheme
- Advantages
to farmers
- Access
to adequate and timely credit to farmers
- Full
year's credit requirement of the borrower taken care of.
- Minimum
paper work and simplification of documentation for drawal of funds from
the bank.
- Flexibility
to draw cash and buy inputs.
- Assured
availability of credit at any time enabling reduced interest burden
for the farmer.
- Sanction
of the facility for 3 years subject to annual review and satisfactory
operations and provision for enhancement.
- Flexibility
of drawals from a branch other than the issuing branch at the discretion
of the bank.
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