KCC provides revolving credit to farmers at heavily subsidised rates. Once sanctioned, you draw and repay as needed — no repeated loan applications. Valid for 5 years with annual review.
Additional Components (toggle to include)
| Year | KCC Limit | Interest @ 4% | Interest @ 7% | EMI (12 months) |
|---|
Interest burden on Year 1 KCC limit over a 6-month crop cycle across different lenders
Short-term Credit Limit Formula:
+ Post-harvest expenses
+ Farm maintenance costs
+ Allied activities component
Year N Limit = Year 1 Limit × (1.10)^(N-1)
[10% annual escalation for Years 2-5]
Scale of Finance is set by the District Level Technical Committee (DLTC) of each district for each crop. The values used here are NABARD indicative figures — actual bank-sanctioned limits may vary.
Interest Subvention Breakdown
| Component | Rate | Provider |
|---|---|---|
| Base KCC Rate | 7% p.a. | Bank |
| Less: Interest Subvention | −2% | Central Govt (loans up to Rs. 3L) |
| Less: Prompt Repayment Incentive | −3% | Central Govt |
| Less: State Subvention (some states) | −0 to 3% | State Govt |
| Effective Rate (prompt repayment) | 2–4% p.a. |
Documents Required for KCC
- Aadhaar Card (identity & address proof)
- PAN Card
- Land ownership records — 7/12 extract, Khasra Khatauni, or Patta / Jamabandi
- Passport size photographs (2–3 copies)
- Bank account details / passbook copy
- No Dues Certificate from other banks (if applicable)
- For tenant farmers: JLG certificate or Sarpanch declaration of cultivation
How to Apply for KCC
- PM Kisan Portal (Easiest): Visit pmkisan.gov.in → Farmers Corner → KCC Form. Pre-approved for existing PM Kisan beneficiaries.
- Bank Branch: Visit SBI, PNB, Bank of Baroda, UCO Bank, or your cooperative bank. Carry all documents.
- CSC Centre: Common Service Centre near you can help submit the application.
- Online Banking: SBI YONO, PNB One, and other bank apps now have KCC application sections.
- Processing time: 2 to 4 weeks from document submission. Loan officer may visit the field.
Kisan Credit Card (KCC) is a revolving credit facility introduced in 1998 by NABARD (National Bank for Agriculture and Rural Development) to provide farmers with affordable and timely credit for agricultural needs.
How it works: Once your bank sanctions a KCC limit (say ₹1,00,000), a credit-cum-savings account is linked to a RuPay card. You can withdraw from ATMs or pay directly to input dealers. You repay after harvest — typically within 12 months. Once repaid, you can draw again without a fresh loan application. This "revolving" nature makes KCC extremely flexible compared to a traditional term loan.
Validity: 5 years, reviewed annually. The bank increases your limit by 10% each year to account for rising input costs. Crops, allied activities, and even household needs (up to one month's expenses) are covered.
The headline interest rate on KCC is 7% per annum. However, after government subventions, the effective rate can be as low as 4% or even 2% for eligible farmers.
- Base rate: 7% p.a. (charged by the bank)
- Minus 2%: Interest Subvention from Central Government (for loans up to Rs. 3 lakh)
- Minus additional 3%: Prompt Repayment Incentive — if you repay within 1 year from the date of disbursement, you get this extra 3% benefit
- Effective rate for prompt repayers: 4% p.a. (some states add 2-3% more, making it nearly 0%)
For comparison: informal moneylenders charge 24–36% per annum. Even microfinance institutions charge 18–22%. KCC at 4% is one of the cheapest credit instruments available anywhere in India.
KCC limit follows the NABARD formula and is set by the District Level Technical Committee (DLTC):
Year 1 Limit = (Scale of Finance per acre × number of acres) + Post-harvest expenses + Farm maintenance + Allied activities component
Scale of Finance is the district-specific crop cultivation cost set by the DLTC each Kharif/Rabi season. It includes seed, fertilizer, pesticide, labour, irrigation, and incidental costs.
Years 2–5: The limit is increased by 10% each year to account for inflation in input costs. So if Year 1 is ₹1,00,000, Year 2 is ₹1,10,000, Year 3 is ₹1,21,000, and so on.
Collateral note: No mortgage required up to ₹1,60,000 (RBI/NABARD guideline). Above ₹1.6L, the bank may ask for land mortgage. Above ₹3L, the bank's internal credit policy applies.
The documentation is straightforward for landowners:
- Aadhaar Card — identity and address proof (mandatory)
- PAN Card — if loan exceeds Rs. 50,000
- Land Records — 7/12 extract (Maharashtra), Khasra Khatauni (UP, MP), Patta (Tamil Nadu), or Jamabandi (Punjab, Haryana)
- Passport-size photographs — 2 to 3 copies
- Bank account passbook or cancelled cheque
- No Dues Certificate from other banks — confirms you have no existing crop loan default
For PM Kisan registered farmers, the application is pre-approved and can be submitted online at pmkisan.gov.in with minimal additional documents.
Yes. Tenant farmers, oral lessees (those farming on verbal lease agreements), and sharecroppers (bataidars) are explicitly eligible under the revised KCC guidelines.
Required proof for non-owners:
- Joint Liability Group (JLG) certificate issued by NABARD-recognised JLG
- Declaration from village Sarpanch confirming you cultivate the specified land
- Patta or lease agreement (if written)
Landless allied activity farmers (dairy, poultry, fishery, goat-rearing) can also get KCC for their allied activity expenses, even without farmland ownership. The limit is based on the cost of the allied activity.
The credit limit for non-landowners may be lower and is typically capped based on the cultivation area declared.
They serve fundamentally different purposes:
| Feature | KCC | Agri Term Loan |
|---|---|---|
| Type | Revolving short-term credit | One-time disbursement |
| Purpose | Seeds, fertilizer, labour, crop expenses | Tractor, land development, irrigation |
| Repayment | Post-harvest, within 12 months | Fixed monthly EMI for 3–7 years |
| Interest | 4% p.a. with subvention | 8–12% p.a. typically |
| Re-use | Draw again after repayment — no fresh application | Fresh loan required each time |
| Validity | 5 years (auto-review) | Ends when repaid |
Most farmers benefit from having both — KCC for seasonal working capital, and a term loan for capital investments. Both can coexist at the same bank.