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Home News Reports Has the govt increased interest rate on Kisan Credit Card loan from 7% to...

Has the govt increased interest rate on Kisan Credit Card loan from 7% to 12%

For the loan under the KCC scheme, farmers have to pay simple interest at 7% per annum for a year or up to the repayment due date, whichever is earlier.

While the Congress has stepped up its the offensive against the Modi government, using obstructionist tactics to malign the much-needed reforms in the agriculture sector, there are a few media houses which are also trying to further slander the government by now spreading false and malicious news regarding loan under the Kisan Credit Card scheme.

Reports have emerged saying that the trouble for the Indian farmers have increased as Modi government has decided that the ones who have taken loan via KCC card will now have to pay interest at 12% per annum instead of 7%. This is, however, untrue. The Press Information Bureau has taken to its official Twitter handle to fact-check the dubious claim.

Sharing the screenshot of the Hindi newspaper clipping which reported that Govt has increased the interest rate for loans against KCC, PIB said that the claim is fake. The Central Government has not made any such announcement regarding increasing the interest rate of KCC loan, the Tweet in Hindi read.

The truth is that the rate of interest for a loan taken by farmers against their KCC remains unvaried. For the loan under the KCC scheme, farmers have to pay simple interest at 7% per annum for a year or up to the repayment due date, whichever is earlier.

In case of non-repayment within the due dates, interest is applied at the card rate. However, if one fails to pay beyond the due date, interest will be compounded half-yearly. However, the repayment period may be fixed as per the anticipated harvesting and marketing period for the crops for which a loan has been granted. 

The Kisan Credit Card (KCC) scheme was launched in 1998 with the aim of providing short-term formal credit to farmers. Prime Minister Narendra Modi had last year launched a saturation drive for distribution of Kisan Credit Cards (KCC) to all the beneficiaries under the PM-KISAN Scheme.

Under this initiative, over 25 lakh beneficiaries of PM Kisan across the country had been provided KCC and over 2,000 bank branches in rural areas had been tasked with providing the KCC to farmers.

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Staff reporter at OpIndia

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