Kisan Credit Card: Kisan Credit Card (KCC) is an important government scheme for farmers. Through this scheme, farmers can get loans from banks at low interest rates for seeds, fertilizers, pesticides and other agricultural expenses. This scheme has been launched for the convenience of farmers. Let’s know about it…
What is Kisan Credit Card Scheme?
The KCC scheme was launched in 1998 to reduce the need for farmers to depend on moneylenders. Farmers can withdraw cash directly from their accounts or make payments for their farming needs. Typically, farmers get loans ranging from ₹50,000 to ₹3 lakh, which have to be repaid within 6 months to 1 year, depending on the crop cycle. Timely repayment also provides a 2-3% discount on the interest rate.
What happens if the loan is not repaid?
If a farmer fails to repay the loan on time, the bank first sends reminders and notices. If payment is not made for 90 days, the account is declared as NPA (Non-Performing Asset) and the recovery process is initiated. The bank first tries to settle the matter, then refers the matter to the Tehsildar or District Administration. If payment is not made, the land can be seized and finally auctioned.
Land Auction Process
The bank fixes the date of the auction and publishes a notice in the newspaper. The farmer is given a last chance. If payment is not made, the land is auctioned, and the loan is repaid from the auction proceeds. If any excess funds remain, they are returned to the farmer. This process takes place under the SARFAESI Act, 2002.
When is the auction not held?
The auction can be postponed if— the crop has been damaged by flood or drought, the government has announced a loan waiver, the farmer holds less than 5 acres of land or a crop insurance claim is pending.
Farmers’ Rights
Farmers can appeal in Loan Restructuring, One Time Settlement, or DRT. It is also possible to stop the auction by getting a stay order from the court. Remember, auction is the last resort of the bank. If the farmer contacts the bank in time, the land can be saved.
