How Does the Kisan Credit Card (KCC) Calculator Work?
The Kisan Credit Card (KCC) scheme aims to provide farmers with timely and adequate credit support from the banking system under a single window. The standard interest rate on a KCC loan is 7% per annum. However, to encourage prompt repayment, the Government of India provides an Interest Subvention (discount) of 3%. Our KCC Calculator helps you easily figure out how much you save by paying your loan on time, bringing your effective interest rate down to just 4%.
Frequently Asked Questions (FAQs)
What is Interest Subvention in KCC?
Interest Subvention is a subsidy provided by the government. If a farmer repays their KCC loan within the due date (usually 1 year), they receive a 3% discount on the standard 7% interest rate, meaning they only pay 4% interest effectively.
What happens if I delay the KCC repayment?
If you fail to repay the loan within the stipulated time (usually 12 months), you lose the 3% interest subvention benefit. The bank will then charge the standard agricultural loan interest rate (which can be 7% or higher depending on bank policy) from the date of disbursement.
Is there a maximum limit for the 3% discount?
Yes, the 3% prompt repayment incentive (Interest Subvention) is available only on short-term crop loans up to ₹3,00,000.