Study on Implementation of KCC Scheme - page 7

isan Credit Card (KCC) is one of the many innovative banking products designed
by NABARD with an objective to enable farmers to meet their credit requirements,
preferably production credit, from financial institutions in a timely and hassle-free
manner. The KCC scheme which was introduced in 1998, has gone through several
changes since then and now incorporates many new features over & above the financing
of crop production requirement, viz., consumption expenditure, maintenance of farm
assets, term loan for agriculture & allied activities, coverage of KCC holders under
Personal Accident Insurance Scheme (PAIS) and very recently the coverage of KCC
holders under Atal Pension Yojna, etc. Today KCC is considered to be one of the most
convenient banking products for the farmers.
The present study aimed at finding out as to whether the present features of Kisan
Credit Card Scheme are serving its intended purpose or not. The report has come out
with many interesting findings and concludes that the implementation of KCC scheme
has benefitted the farmers to a great extent and the farmers are able to generate profit,
albeit in varying quantities. The study has also highlighted some concerns relating to
the implementation of the scheme in light of the revised guidelines but these do not
seem to be affecting the prospects of farmers getting the KCC loans from the bank and
making the best use of it for crop cultivation. The study has also indicated that Interest
Subvention as well as incentives for prompt repayment have positive impacts on the
agricultural income of farmers covered under KCC scheme.
The slow progress on use of RuPay Cards by farmers on account of their not being
comfortable with use of ATM cards and also their apprehension/ fear of frauds and
trust issues i.e., likely misuse by their family members suggests need for enhanced
efforts on financial counselling, particularly of illiterate farmers. I hope, the banks will
now actively promote use of RuPay cards by farmers in the wake of government thrust
on digital payment.
I hope the findings of the study as well as the recommendations suggested by the
author would by very useful for the policy makers and bankers. NABARD, on its part
has already reviewed the report and is now working on various models so as to find
out if any further improvement can be made in the existing guidelines to make it more
farmer friendly.
H R Dave
Deputy Managing Director
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