Delhi, 28 May (H.S.): The Union Cabinet, led by Prime Minister Narendra Modi, has approved the continuation of the Interest Subvention (IS) component under the Modified Interest Subvention Scheme (MISS) for the financial year 2025-26, alongside necessary funding arrangements. This Central Sector Scheme facilitates affordable short-term credit for farmers via Kisan Credit Cards (KCC).
Key aspects include:
- Farmers can secure short-term loans of up to Rs.3 lakh at a subsidized interest rate of 7%, with eligible lending institutions receiving a 1.5% interest subvention.
- Timely loan repayments allow farmers to access an additional 3% Prompt Repayment Incentive (PRI), effectively bringing their interest rate on KCC loans down to 4%.
- For loans dedicated to animal husbandry or fisheries, the interest benefit applies to amounts up to Rs.2 lakh.
Currently, there are over 7.75 crore KCC accounts in India. Continuing this support is vital for maintaining institutional credit flow in agriculture, particularly for small and marginal farmers, enhancing productivity, and promoting financial inclusion. Agricultural credit disbursement has significantly increased, from Rs.4.26 lakh crore in 2014 to Rs.10.05 lakh crore by December 2024. The Cabinet's decision underlines the Government's commitment to doubling farmers’ income and developing a robust rural credit ecosystem.
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Hindusthan Samachar / Jun Sarkar
