Study on Implementation of KCC Scheme - page 27

Circulars on KCC implementation
Cir. No. 15/98-99
dtd. 14.08.1998
Cir. No. NB.214/
PCD.30/2004 dtd
Circular No 71/PCD 04/2011-12 dtd
29.03.2012 & No. 97/PCD 10/2012
dated 20 April 2012
DCCB branch/
PACS. Cash
at DCCB/
PACS only. All
at DCCB to
be reported to
PACS concerned
as ledger is
maintained at
rate. Separate folio for the long
term sub-limit.
11 Coverage
(PAIS) for
KCC holders
PAIS for KCC holders
was introduced vide
circular No. NB.PCD
(KCC)/H.182/ KCC.11
(A)/2001-02 dated
14 June 2001 for
uniform adoption by
cooperatives & RRBs.
Master Policy was
valid for 3 years with
annual renewal.
No Change
The KCC holder should have the
option to take benefit of Crop
Insurance, Assets Insurance,
Personal Accident Insurance Scheme
(PAIS), and Health Insurance
(wherever product is available and
have premium paid through his KCC
account). Farmer beneficiaries should
be made aware of the insurance cover
available and their consent is to be
obtained, at the application stage
1.2 It may be seen from Table 1.1 & 1.2 that over the period, the guidelines on KCC
scheme have been modified to facilitate the farmers to fulfil their production
needs in a hassle-free and cost effective manner. Many add-on features were
incorporated in the original KCC guidelines (1998) during 2004 and 2012 to take
care of other needs of the farmers, viz., consumption expenditure, maintenance of
farm assets, term loan for agriculture & allied activities, coverage of KCC holders
under PAIS and recently the coverage of KCC holders under Atal Pension Yojna
(in 2015), etc. However, the interest subvention is limited to ‘crop production’ of
the KCC limit and bankers are required to make two separate accounts.
1.3 The circular on revised KCC scheme issued by NABARD (No 71 dated 29 March
2012) andalsobyRBI (RBI/2011-12/553; RPCD.FSD.BC.No.77/05.05.09/2011-12
dated 11 May 2012) to scheduled commercial banks (excluding RRBs) have
clearly spelt out that the short term loans and term loans are governed by different
interest rates. Besides, at present, short term crop loan is covered under Interest
Subvention Scheme/ Prompt Repayment Incentive scheme. Further, repayment
schedule and other norms are different for short term and term loans. Hence,
in order to have operational and accounting convenience, the card limit is to be
bifurcated into separate sub limits for short term cash credit limit cum savings
account and term loan.
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