Every Re 1 under KCC‑MISS adds Rs 2.30 to farm value: Minister
New Delhi, Aug 3
Every Re 1 invested under the Kisan Credit Card- Modified Interest Subvention Scheme contributed Rs 2.30 to net value addition in the agriculture and allied sector, the Parliament was informed on Monday, citing a third-party assessment finding.
The third‑party assessment by the Institute for Social and Economic Change, Bengaluru, found the scheme has reduced farmers' interest burden and positively impacted cropping intensity and multi‑season cultivation, MoS Finance, Pankaj Chaudhary, said in the Lok Sabha in reply to a question.
The scheme significantly reduced the interest burden on farmers, with an estimated subsidy outlay of Rs 1.87 lakh crore since inception till 2024-25.
It helped KCC-MISS farmers cultivate larger areas, adopting more diversified crop portfolios across seasons, supported by reliable irrigation and concessional credit.
It has improved the timeliness of input use through access to adequate working capital, and beneficiaries receiving Prompt Repayment Incentive (PRI) have demonstrated better credit discipline, thereby enhancing banks' confidence for further lending.
The scheme has supported dairy and livestock expansion and promoted income diversification by supplementing crop income, reducing dependence on seasonal agriculture, and integrating livestock and fisheries farming with crop production.
It has also supported Working Capital Requirements (WCR) for inland fisheries, which is significant for diversification in the North-Eastern Region.
The minister said the government also introduced several technological interventions such as Kisan Rin Portal, Jan Samarth portal, e-KCC, KRISHIKA to streamline the agricultural credit delivery process.
It expanded KCC coverage, simplified application procedures, and strengthened digital access to small and marginal farmers.
The government has introduced several measures, including annual ground‑level credit targets and priority sector lending targets for banks.
It increased the collateral‑free loan limit in KCC from Rs 1.6 lakh to Rs 2 lakh with effect from January 1, 2025.
The government, RBI, NABARD, State Level Bankers Committee (SLBCs) and banks conducted various awareness programmes to bring awareness about the benefits of the KCC scheme among farmers.
— IANS
Reader Comments
Finally, a scheme that actually shows results! My father availed KCC benefits in Punjab and the Prompt Repayment Incentive made a huge difference - he got a lower interest rate and banks are now more willing to extend credit. This third-party assessment gives credibility to the scheme. 👏
While the ROI metrics look good, we need to question whether the assessment accounts for inflation and debt traps. The subsidy amount of ₹1.87 lakh crore is huge - could this money have been spent on better irrigation infrastructure instead? Not doubting the scheme, just questioning efficiency. 🤔
The North-Eastern Region mention about inland fisheries is a welcome move. My cousins in Assam have benefited from this diversification - they're now earning year-round instead of just during the single cropping season. KCC is truly helping rural India transform. ❤️
Interesting read. As someone who follows global agri-finance, India's KCC scheme is actually quite unique in integrating credit with interest subvention and insurance-like incentives. The 2.3x multiplier on investment is impressive. Would love to see more such evidence-based policy assessments.
Every Re 1 giving Rs 2.30 back - that's the kind of return even mutual funds can't guarantee! But let's be honest, the real test is whether this translates to better living standards for the poorest farmers. The digital portals are good but many villages still lack internet connectivity. Let's bridge that gap first.
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