Modified Interest Subvention Scheme

Modified Interest Subvention Scheme Latest News

A third-party assessment by the Institute for Social and Economic Change (ISEC), Bengaluru said that every ₹1 invested under Kisan Credit Card– Modified Interest Subvention Scheme (KCC-MISS) contributes ₹2.30 to net value addition in the agriculture & allied sector. 

About Modified Interest Subvention Scheme

• It is a Central Sector Scheme launched in 2006–07 by the Government of India.
• Aim: It is aimed at ensuring the availability of short-term credit to farmers at an affordable interest rate through Kisan Credit card (KCC).
• Under the Scheme: 
  • Farmers received short-term loans of up to Rs.3 lakh through Kisan Credit Cards (KCC) at a subsidized interest rate of 7%, with 1.5% interest subvention provided to eligible lending institutions.
  • Additionally, farmers repaying loans promptly are eligible for an incentive of up to 3% as Prompt Repayment Incentive (PRI) effectively reducing their interest rate on KCC loans to 4%.
  • For loans taken exclusively for animal husbandry or fisheries, the interest benefit is applicable up to Rs.2 lakh.
• It is implemented by the Reserve Bank of India (RBI) and the National Bank for Agriculture and Rural Development (NABARD).
• It is operated through Public Sector Banks, Regional Rural Banks (RRBs), Cooperative Banks and Private Sector Banks operating in rural and semi urban areas.

Source: PIB

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