In a major boost to agricultural financing, the Government of India has increased the Kisan Credit Card (KCC) limit for farmers in 2025. This move is part of a broader initiative to ensure more accessible and flexible credit support for the agricultural sector, especially for small and marginal farmers. The revision is expected to enhance liquidity, support modern farming practices, and address the rising costs of inputs.
Here’s everything you need to know about the updated KCC Loan Scheme and how the new rules affect eligibility, loan limits, and repayment structures.
What Is the KCC Loan Scheme?
The Kisan Credit Card (KCC) Loan Scheme is a government-backed financial product introduced in 1998 by NABARD to meet the short-term credit needs of farmers. It allows easy access to institutional credit for crop production, post-harvest expenses, and other allied agricultural activities such as animal husbandry and fisheries.
Unlike traditional loans, the KCC Loan Scheme offers flexibility in withdrawals and repayments, making it an ideal solution for seasonal farming needs. The interest rates are subsidized, and repayment terms are often aligned with crop cycles.
What’s New in 2025? – Revised Loan Limits
One of the most significant changes introduced in 2025 is the increase in the maximum KCC credit limit. Here’s a breakdown of the updates:
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Revised Credit Limit: The KCC limit has been increased from ₹3 lakh to ₹5 lakh per borrower.
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Animal Husbandry & Fisheries: Separate limits have also been enhanced for these sectors, acknowledging their growing contribution to rural incomes.
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Collateral-Free Threshold Raised: Previously, loans up to ₹1.6 lakh were collateral-free. In 2025, this limit has been raised to ₹2 lakh, encouraging more farmers to borrow without fear of asset forfeiture.
This change aligns with inflationary trends and the increasing costs of seeds, fertilizers, pesticides, and equipment.
Enhanced Credit Support for Farmers
The increased KCC limit comes with improved credit support, ensuring that farmers can access higher capital for both crop and non-crop requirements.
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Multi-purpose Credit: Funds can now be used for a wider range of activities, including warehousing, market-related travel, and technological upgrades.
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Digital Integration: KCC accounts are being increasingly integrated with digital banking platforms, enabling faster disbursal and monitoring of credit usage.
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Timely Repayment Incentives: Farmers who repay on time continue to enjoy interest subvention benefits of up to 3%, bringing down the effective interest rate to as low as 4% annually.
Eligibility Criteria in 2025
The eligibility criteria for the KCC Loan Scheme remain largely the same, with minor expansions to include more beneficiary categories:
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Farmers engaged in crop cultivation, animal husbandry, and fisheries
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Self-help groups (SHGs) and joint liability groups (JLGs)
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Tenant and sharecropper farmers with appropriate documentation
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Aadhaar and PAN linkage is mandatory for all new applicants
A streamlined application process and single-window service have been rolled out in many districts to improve access.
How to Apply for the Revised KCC Limit
Applying under the updated KCC Loan Scheme is straightforward:
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Visit your bank branch – Most nationalized and cooperative banks offer KCC facilities.
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Submit necessary documents – Identity proof, land records or lease agreement, passport-sized photos, and bank account details.
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Verification and approval – Post verification, the KCC will be issued with the revised credit limit and usage terms.
Applicants can also use online portals like the official KCC website or through mobile banking apps, where available.
Impact on Rural Economy
The revised KCC structure is expected to significantly benefit the rural economy by:
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Reducing dependency on informal lenders
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Encouraging investment in modern agricultural practices
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Providing security against crop failure or price volatility through timely credit support
It also indirectly promotes crop diversification and agri-entrepreneurship, key drivers of rural resilience.
FAQs
Q1: What is the new maximum loan limit under the KCC Loan Scheme in 2025?
The maximum loan limit has been increased to ₹5 lakh per borrower.
Q2: Are collateral-free loans available under the new KCC rules?
Yes. Loans up to ₹2 lakh are now collateral-free, an increase from the earlier ₹1.6 lakh limit.
Q3: Who is eligible for the KCC Loan Scheme in 2025?
Eligible groups include individual farmers, SHGs, JLGs, tenant farmers, and those engaged in allied activities like animal husbandry and fisheries.
Q4: Can the KCC loan be used for non-crop purposes?
Yes, the revised scheme allows use of funds for warehousing, marketing, animal rearing, and other agri-support functions.
Q5: What is the interest rate under the KCC Loan Scheme?
With interest subvention for timely repayment, the effective rate can be as low as 4% per annum.
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