The Reserve Bank of India has issued new directions for the Kisan Credit Card scheme for Regional Rural Banks, applicable to loans sanctioned from January 1, 2027. The framework sets out a six-year composite credit facility to cover short-term crop cultivation, allied activities, post-harvest and produce marketing needs, household consumption, maintenance and insurance costs, and longer-term investment credit for agriculture and allied activities. Existing KCC loans sanctioned before that date will remain under the current guidelines until maturity or the next renewal. The directions define the KCC limit as the sixth-year short-term credit limit plus the estimated long-term component, with the short-term portion operating as a revolving cash credit facility. Drawing limits for crops and allied activities are to be linked to the applicable Scale of Finance, with add-ons of 10 per cent for post-harvest expenses and household consumption, 20 per cent for maintenance and technology-related farm expenses, and any insurance premium. Eligible borrowers include owner cultivators, tenant farmers, oral lessees, sharecroppers, and relevant Self-Help Groups and Joint Liability Groups. Marginal farmers may also receive a Flexi KCC of INR 10,000 to INR 50,000 based on the bank's assessment without linking the limit to land value. Regional Rural Banks must waive collateral security and margin requirements for agricultural and allied loans up to INR 200,000 per borrower, while KCC loans against hypothecation of crops or stock with tie-up recovery arrangements may be collateral-free up to INR 300,000. The directions also allow banks to maintain separate sub-limits within the composite facility, require monitoring of end use and periodic review, and require banks to enable KCC operations through channels including Unified Payments Interface, debit cards, mobile and internet banking, National Electronic Funds Transfer, Real Time Gross Settlement and Central Bank Digital Currency, subject to the account holder's explicit consent.
Reserve Bank of India2026-06-19
Reserve Bank of India issues Regional Rural Banks Kisan Credit Card directions for six year composite loans from January 2027
The Reserve Bank of India has issued new Kisan Credit Card directions for Regional Rural Banks, applying to loans sanctioned from January 1, 2027. The rules create a six-year composite facility for crop, allied and investment needs, set drawing-limit rules linked to Scale of Finance, and introduce Flexi KCC of INR 10,000 to INR 50,000 for marginal farmers. Collateral and margin must be waived up to INR 200,000 per borrower, with existing loans remaining under current rules until maturity or the next renewal.