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Informist, Thursday, Feb. 12, 2026

 

--RBI issues draft norms on revised Kisan Credit Card scheme

--RBI seeks feedback on revised Kisan Credit Card scheme draft by Mar 6 

 

MUMBAI – The Reserve Bank of India Thursday released the draft directions for the revised kisan credit card scheme with a view to expand coverage, streamline operational aspects, and address emerging requirements. The RBI has sought feedback on the draft direction by Mar. 6.

 

The central bank has proposed to standardise crop seasons to bring in uniformity in loan sanction and repayment schedules. Crop season--the period up to harvesting and marketing of the crops raised--for 'short duration crops' shall be considered as 12 months and for 'long duration crops' as 18 months, the RBI has proposed.

To ensure proper dovetailing of loan tenure with crop seasons especially for the longer duration crops, the RBI has proposed to extend the tenure of the kisan credit card to six years from five years earlier.

 

The term-loan component under the kisan credit card will be repayable within a period of six years depending on the type of activity or investment, as per the bank's credit policy applicable for investment credit, the central bank said. 

 

The RBI has proposed a flexi kisan credit card with a limit of INR 10,000 to INR 50,000 for marginal farmers based on the land holding and crops grown. This limit will be provided for the working capital and investment related credit needs of the marginal farmers, the RBI said. The composite kisan credit card limit will be fixed for a period of six years, the RBI said.

 

The central bank has proposed that banks waive collateral security and margin requirements for agricultural loans including loans for allied activities up to INR 200,000 per borrower. "However, the voluntary pledge of gold and silver as collateral for agriculture loans up to the collateral-free limit will not be considered as a violation of the guidelines on collateral-free lending to the agriculture sector," the RBI said. "Banks shall obtain and retain explicit declaration from the borrower in such cases."

 

Banks will decide the collateral security and margin requirements for loans above INR 200,000 as per their credit policy and in adherence with RBI guidelines issued from time to time, the central bank said. 

 

To ensure that farmers receive adequate credit based on actual cost of cultivation, drawing limits under kisan credit card will be aligned with the scale of finance for each crop season, the RBI has proposed

 

"To enable farmers to access finance for technological interventions such as soil testing, real time weather forecasts and organic/good agricultural practices certification etc such expenses has been added as eligible components within 20?ditional component towards repairs and maintenance of farm assets," the RBI said in the draft directions.  End

 

Reported by Shubham Rana

Edited by Akul Nishant Akhoury

 

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