Certainly, I can provide an article on Interest on Kisan Credit Card (KCC).
Kisan Credit Card (KCC) is a credit card scheme for farmers introduced by the Government of India in 1998. The card is aimed at providing timely and easy access to credit to farmers, thus enabling them to meet their agricultural and allied needs.
The KCC is available to all farmers, including small and marginal farmers, sharecroppers, and tenant farmers. Under this scheme, farmers can avail credit for various agriculture-related purposes, including the purchase of inputs like seeds, fertilizers, pesticides, and animal feed, as well as other expenses like farm maintenance, repairs, and machinery.
The Kisan Credit Card offers several benefits to farmers, including a flexible repayment period, low-interest rates, and no collateral requirement for loans up to Rs. 1.6 lakhs. However, one of the key factors that farmers need to be aware of is the interest rate charged on the KCC.
The interest rate on KCC varies depending on the bank and the loan amount. Typically, the interest rate ranges from 7% to 9%, which is considerably lower than the interest rates charged on other types of loans. As per the Government of India, the interest rate on KCC should not exceed 9% per annum.
Another important aspect to note for farmers is that the interest on KCC is calculated on a daily balance basis. This means that the interest is calculated on the outstanding loan amount on a daily basis, which results in lower interest payments for farmers.
Moreover, farmers can also benefit from a 2% interest subsidy on their KCC loans, which is provided by the Government of India. The subsidy is given to the farmers who repay their loans on time, i.e., within the due date.
In conclusion, the Kisan Credit Card is a beneficial scheme for farmers, and the interest rate is relatively low compared to other forms of credit. Farmers need to ensure that they repay their loans on time to avail the interest subsidy provided by the government. The KCC has the potential to make a significant impact on the rural economy by providing farmers with timely and affordable credit.