Kisan Credit Card: RBI approves interest subsidies under KCC loans until March 2024

The Kisan credit card offers a number of advantages. Farmers in India may apply for loans from the State Bank of India (SBI) using this card. For the current and next fiscal year, the government has approved the continuation of the interest subvention plan for short-term loans up to Rs 3 lakh for agricultural and associated industries acquired via Kisan Credit Card (KCC).

As part of the Kisan credit card  programme, the government subsidises banks so that they may provide low-interest, short-term crop loans to farmers engaged in agriculture and associated sectors including animal husbandry, dairying, fishing, and beekeeping, up to a maximum loan amount of Rs 3 lakh.

It's worth noting that the Center's programme provides loans to farmers at a preferential interest rate of 7 per cent. Those farmers who make their loan payments on time get an interest subsidy of 3 per cent each year.

Here's how it will work for the next two years
For the two years 2022–23 and 2023–24, the RBI has announced in a circular that the rate of interest subvention to lending institutions would be 1.5%. In contrast, that same percentage of aid was 2% for the fiscal year 2021-22. As a result of the time extension, it has been lowered by 0.5 percentage points.

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Interest subsidies will be offered to small farmers for six months following harvest in exchange for receipts of the goods stored in the recognised warehouse, with the goal of discouraging farmers from engaging in panic selling and encouraging them to keep their produce in storage facilities.

Wheat prices under close watch
The government has said that it is monitoring wheat prices and would act to prevent any drastic increases in retail prices. Sanjeev Chopra, the food secretary for the Union, has said that there is an adequate supply of emergency food.