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Kisan Credit Card Rules Revised: The RBI's new KCC rules, effective from January 1, 2027, will make it easier for farmers to secure loans and better meet their farming-related needs.

Kisan Credit Card Rules Revised: To ensure farmers across the country have access to easy and timely credit, the Reserve Bank of India (RBI) has issued new guidelines under the Kisan Credit Card (KCC) scheme. This new framework will apply to commercial banks, small finance banks, regional rural banks (RRBs), and rural cooperative banks. The new rules will apply to loans sanctioned from January 1, 2027, onwards, while existing loans will continue under the previous system.

The RBI states that the objective of these changes is to provide farmers with adequate financial assistance for farming and allied activities through a simplified process.

What has changed in the KCC scheme?

Under the new rules, the Kisan Credit Card will be offered as a combined credit facility with a six-year tenure. This will enable farmers to obtain loans for farming as well as other requirements.

The following needs will now be covered under the KCC:

• Short-term loans for crop cultivation
• Activities such as animal husbandry, fisheries, and beekeeping
• Post-harvest expenses
• Household needs of the farming family
• Maintenance of agricultural equipment and assets
• Crop, health, and accident insurance
• Marketing of agricultural produce
• Investments in agriculture and allied sectors

How has the crop season been defined?

For the first time, the RBI has standardized the crop season for the KCC.

The crop season will encompass the entire period from sowing to harvesting and the sale of the crop.

How much loan can be obtained without collateral?

In a welcome move for farmers, the RBI has waived the requirement for collateral and margin for agricultural loans up to ₹2 lakh.

Key Rule:

• No collateral/guarantee is required for agricultural loans up to ₹2 lakh. Farmers may voluntarily pledge gold or silver as collateral if they wish.
• For loans exceeding ₹2 lakh, banks will make decisions based on their respective policies.
• In certain special cases, the requirement for a guarantee may be waived for loans up to ₹3 lakh.
• The RBI has also clarified that there are currently no plans to raise the limit for collateral-free loans.

Which farmers will benefit?

This scheme will not be limited solely to land-owning farmers; its scope will include:

Land-owning farmers
Sharecroppers
Tenant farmers
Oral lessees
Self-Help Groups (SHGs)
Joint Liability Groups (JLGs)

Banks will determine the repayment duration based on crop cycles and income. Additionally, the loan limit will be reviewed and renewed periodically.