The Reserve Bank of India (RBI) has announced important changes to the Kisan Credit Card (KCC) scheme.
The new rules will come into effect from January 2026 and are aimed at making loan approval and repayment processes more uniform for farmers across the country.
Crop Season Definition Standardised
The RBI has revised the definition of a crop season to match its Income Recognition and Asset Classification (IRAC) norms.
Under the new rules:
Short-term crops will have a standard crop season of 12 months.
Long-term crops will have a standard crop season of 18 months.
A crop season refers to the period from sowing a crop to its harvesting and sale in the market. The move is expected to bring more clarity to loan repayment schedules under the KCC scheme.
No Increase in Unsecured Loan Limit
The RBI has rejected suggestions to increase the limit for unsecured agricultural loans.
According to the central bank, the limit was already revised in December 2024, and there are currently no plans to raise it further.
Relief for Farmers on Small Loans
The RBI has directed banks to remove guarantee, security, and margin requirements for agricultural loans up to ₹2 lakh per borrower. This includes loans taken for farming and other agricultural activities.
In addition, banks can waive collateral requirements for loans up to ₹3 lakh if the KCC loan is backed by pledged crops or agricultural stock.
Banks Asked to Review KCC Limits
The RBI has also instructed banks to regularly review and renew short-term KCC limits for crop cultivation and related farming activities as per their credit policies.
These changes are expected to make agricultural lending more streamlined and provide greater convenience to farmers using the Kisan Credit Card scheme.
