Since most farmers are not eligible for regular credit cards, in 1998, the government of India launched the Kisan Credit Card scheme designed solely for farmers.
These credit cards have attractive interest rates with flexible repayment options that help owners as well as tenant farmers get short-term formal credit.
Read: Karnataka Janasevaka Scheme
Kisan Credit Card Scheme – Benefits
The credit can be used to meet financial requirements for agricultural and allied activities, post-harvest expenses, get loans for investments such as buying dairy animals, pump sets, etc. and insurance coverage. These credit cards are available from regional rural banks, public sector commercial banks and cooperative banks.
How Does A Kisan Credit Card Work?
Kisan Credit Cards do not work like other regular unsecured credit cards. When an individual applies for this card, the loan officer will approve a loan of up to INR 3 lacs. Once the amount is sanctioned, the credit card will be issued.
The cardholders can then make purchases or take a loan against the credit limit. Interest is applicable only on the amount spent and the maximum tenure for a loan taken against this card is 5 years.
Who Is Eligible For The Kisan Credit Card Scheme?
- Individuals who own the land and cultivate it
- Farmers who are individual/joint borrowers of land
- Individuals involved in farming or allied activities
- Tenant farmers, share croppers or oral lessees
- Self-help groups and Joint liability groups that include sharecroppers or tenant farmers
- Farmers who are stay within the bank’s operational area
- Farmers who are eligible for a production credit of at least Rs 5,000
Documents Required To Avail Kisan Credit Card Scheme
To apply for a Kisan Credit Card, the applicant needs passport sized photographs and must be able to prove their identity and that they live within the bank’s operational area. The document that can be used to prove this are:
Proof Of Identity
- PAN Card
- Aadhaar Card
- Driver’s License
- Voter’s ID Card
- Passport
- Person of Indian Origin Card
- Overseas Citizen of India Card
- Letters issued by the UIDAI
- Job card issued by NREGA
Proof Of Address
- Aadhaar card
- Ration Card
- Driver’s License
- Person of Indian Origin Card
- Passport
- Utility Bill that is not more than 3 months old
- Bank Account Statement
- Property Registration Document
- Job card issued by NREGA
Applying For A Kisan Credit Card
Farmers can apply for a Kisan credit card by visiting the bank branch office. Some banks let you download the application form online. When the applicant visits the bank, a bank official will help them fill out a form and take the necessary documents to process the application.
Though you can’t really submit the application or required documents online, the application form can be downloaded and then filled. The application and documents must then be submitted at the closest bank branch.
Some of the factors used to evaluate the cardholder’s credit limit include:
- Land area
- Crops being grown
- Household requirements
- Pre & post-harvest expenditure
- Other maintenance expenses
- Farm assets
- Crop and personal accident insurance
Banks That Let You Download Application Form Online
Once the card is sanctioned, it will be dispatched to the individual.