Executive Summary:
This circular from the Reserve Bank of India outlines the operational guidelines for the Interest Subvention Scheme for Kisan Credit Card (KCC) to fisheries and animal husbandry farmers for the years 2018-19 and 2019-20. It details the interest subvention of 2% and Prompt Repayment Incentive (PRI) of 3% offered by the Government of India. Banks are required to submit claims for these subventions within a specified timeframe and ensure Aadhar linkage for farmers availing these loans.
Key Points / Main Content:
Interest Subvention Scheme Details:
* A 2% interest subvention is provided to lending institutions (Public and Private Sector Commercial Banks through their rural and semi-urban branches using their own resources) for short-term loans up to ₹2 lakh to farmers involved in animal husbandry and fisheries activities via a separate KCC, resulting in a 7% interest rate for farmers.
* The 2% subvention is calculated from the date of disbursement to the date of actual repayment or the due date fixed by the bank, whichever is earlier, with a maximum period of one year.
* For farmers with existing KCCs for crop loans, the KCC for animal husbandry/fisheries should be within an overall limit of ₹3 lakh.
Prompt Repayment Incentive (PRI):
* An additional 3% interest subvention is provided to farmers repaying on time, effectively reducing the interest rate to 4% per annum.
* This benefit applies only to farmers who repay both their short-term crop loan and working capital loan for animal husbandry/fisheries activities on time.
Loan Limits and Prioritization:
* Interest subvention is provided on a maximum limit of ₹2 lakh short-term loan for animal husbandry and fisheries.
* For farmers with existing KCC crop loans, a sub-limit can be availed for animal husbandry/fisheries.
* The overall limit for interest subvention and PRI on short-term loans (crop loan + working capital loan) is ₹3 lakh per annum, with a maximum of ₹2 lakh for farmers involved solely in animal husbandry and/or fisheries.
* The crop loan component takes priority for interest subvention and PRI benefits.
Aadhar Linkage and DBT:
* Aadhar linkage is mandatory for farmers availing short-term loans for Animal Husbandry and Fisheries in 2018-19 and 2019-20 to ensure hassle-free benefits.
* The Interest Subvention Scheme is being put on DBT mode.
* Banks must capture and submit category-wise data of beneficiaries on the ISS portal (once launched) to settle claims from 2018-19 onwards.
Claim Submission Guidelines:
* Banks must submit claims for the 2% interest subvention on a half-yearly basis (September 30 and March 31). The March 31st claim must include a Statutory Auditor's certificate.
* Claims for the 3% prompt repayment incentive should be submitted as a one-time consolidated claim for disbursements made during 2018-19 and 2019-20, with a Statutory Auditor's certificate.
* "Additional Claims" for disbursements made during 2018-19 and 2019-20, due during 2019-20 and 2020-21 respectively, can be submitted separately, certified by the Statutory Auditor.
* Claims must be submitted within a quarter from the close of the half-year/year, with "Additional Claims" submitted by June 30, 2020, and June 30, 2021, respectively, in specified formats (Formats I and II) to the RBI.
* Copies of audited claims should also be submitted to relevant Government of India departments.
Impact Analysis:
Public and Private Sector Scheduled Commercial Banks:
*Impact:* Banks are responsible for implementing the Interest Subvention Scheme, disbursing loans at the concessional rate, and claiming the subvention from the RBI. They are also required to give adequate publicity to the scheme.
*Action Required:* Submit claims for interest subvention and prompt repayment incentive within the stipulated timelines and formats, ensure Aadhar linkage, capture beneficiary data for the ISS portal, and make the scheme known to eligible farmers.
Fisheries and Animal Husbandry Farmers:
*Impact:* Farmers can access short-term loans at a concessional interest rate of 4% (if they repay promptly) for activities related to animal husbandry and fisheries, improving their access to working capital.
*Action Required:* Link Aadhar card to KCC account to avail short term loans and ensure timely repayment to avail the additional 3% interest subvention benefit.
Reserve Bank of India:
*Impact:* RBI is responsible for overseeing the implementation of the scheme and processing the claims submitted by the banks.
*Action Required:* Process claims submitted by banks and ensure smooth implementation of the scheme.
Government of India (Ministry of Agriculture and Farmers Welfare, Ministry of Fisheries, Animal Husbandry and Dairying):
*Impact:* The government bears the financial burden of the interest subvention and aims to boost the fisheries and animal husbandry sectors.
*Action Required:* Monitor the scheme's progress and receive copies of audited claims submitted by banks.
Key Entities Referenced
Reserve Bank of India: The central bank of India, responsible for regulating the banking system and managing monetary policy.
Kisan Credit Card: A credit scheme that provides farmers with access to credit for agricultural needs.
Interest Subvention Scheme: A government scheme to provide interest subsidy on loans to farmers.
Animal Husbandry: The branch of agriculture concerned with animals that are raised for meat, fibre, milk, eggs, or other products.
Fisheries: The industry or activity concerned with catching, processing, and selling fish or shellfish.
Government of India: The Union Government established by the Constitution of India.
Ministry of Agriculture and Farmers Welfare: A ministry of the Government of India responsible for agriculture and farmer's welfare.
Mumbai, Maharashtra: The financial capital of India, where the Central Office of Reserve Bank of India is located.
भारतीय �रज़व र् ब�क
RESERVE BANK OF INDIA
www.rbi.org.in
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RBI/2019-20/48
FIDD.CO.FSD.BC.No.10/05.02.001/2019-20 August 26, 2019
The Chairman / Managing Director & CEOs
All Public & Private Sector Scheduled Commercial Banks
Madam/Dear Sir,
Interest Subvention Scheme for Kisan Credit Card (KCC) to Fisheries and Animal
Husbandry farmers during the years 2018-19 and 2019-20
Please refer to our circular FIDD.CO.FSD.BC.12/05.05.010/2018-19 dated February 4,
2019 extending KCC facility to animal husbandry farmers and fisheries for their working
capital requirements and our letter dated May 27, 2019 conveying Government’s approval
to extend the benefits of Interest Subvention at 2% and Prompt Repayment Incentive (PRI)
at 3% to fisheries and animal husbandry farmers to meet their working capital needs under
the KCC scheme.
2. In this regard, it is advised that Government of India has now issued the operational
guidelines of the Interest Subvention Scheme for Kisan Credit Card facility to fisheries and
animal husbandry farmers for a period of two years i.e. 2018-19 and 2019-20 with the
following stipulations:
i. In order to provide short-term loans upto ₹ 2 lakh to farmers involved in activities
related to Animal Husbandry and Fisheries, through a separate KCC for these
activities, apart from the existing KCC for crop loan, at a concessional interest rate
of 7% per annum during the years 2018-19 and 2019-20, it has been decided to
provide interest subvention of 2% per annum to lending institutions viz. Public
Sector Banks (PSBs) and Private Sector Commercial Banks (in respect of loans
given by their rural and semi-urban branches only) on use of their own resources.
This interest subvention of 2% will be calculated on the loan amount from the date
of its disbursement / drawal upto the date of actual repayment of the loan by the
farmer or up to the due date of the loan fixed by the banks, whichever is earlier,
subject to a maximum period of one year. In case of farmers possessing KCC forraising crops and involved in activities related to animal husbandry and/or fisheries,
the KCC for animal husbandry/fisheries shall be within the overall limit of ₹ 3 lakh.
ii. To provide an additional interest subvention of 3% per annum to such of those
farmers repaying in time i.e. from the date of disbursement of the working capital
loan upto the actual date of repayment by farmers or upto the due date fixed by
the banks for repayment of loan, whichever is earlier, subject to a maximum period
of one year from the date of disbursement. This also implies that the farmers
repaying promptly as above would get short term loans @ 4% per annum during
the years 2018-19 and 2019-20. This benefit would accrue to only those farmers
who repay their both short term crop loan and working capital loan for animal
husbandry/fisheries activities in time.
iii. Interest subvention is to be provided on a maximum limit of ₹ 2 lakh short term
loan to farmers involved in animal husbandry and fisheries. The farmers already
possessing KCC (crop loan) and involved in animal husbandry & fisheries
activities, can avail a sub-limit for such activities. However, the interest subvention
and prompt repayment incentive benefit on short term loan (i.e. crop loan+ working
capital loan for animal husbandry and fisheries) will be available only on an overall
limit of ₹ 3 lakh per annum and subject to a maximum limit of ₹ 2 lakh per farmer
involved in activities only related to animal husbandry and / or fisheries. The limit
for crop loan component will take priority for interest subvention and prompt
repayment incentive benefits and the residual amount will be considered
towards animal husbandry and / or fisheries subject to cap as mentioned
above. (Illustrations)
iv. To ensure hassle-free benefits to farmers under Interest Subvention Scheme,
banks are advised to make Aadhar linkage mandatory for availing short-term loans
for Animal Husbandry and Fisheries in 2018-19 and 2019-20.
v. The Interest Subvention Scheme is being put on DBT mode on ‘In Kind/services’
basis and all short term loans processed from 2018-19 are required to be brought
on ISS portal / DBT platform. Banks are advised to capture and submit the category
wise data of beneficiaries under the scheme and report the same on ISS portal
individual farmer wise once it is launched by the Ministry of Agriculture and
Farmers Welfare to settle the claims arising from 2018-19 onwards.3. Banks may give adequate publicity to the above scheme so that the eligible farmers
can avail the benefits.
4. It is also advised as under:
i) In respect of 2% interest subvention, banks are required to submit their claims on a
half-yearly basis as on September 30 and March 31 for the years 2018-2019 and 2019-
2020, of which, the latter needs to be accompanied by a Statutory Auditor’s certificate
certifying the claims for subvention for the financial year ended on March 31 of the
corresponding year as true and correct.
ii) In respect of 3% prompt repayment incentive, banks may submit their one-time
consolidated claims pertaining to the disbursements made during the years 2018-19
and 2019-20, accompanied by Statutory Auditor’s certificate certifying the claim as true
and correct. Any remaining claim pertaining to the disbursements made during the
years 2018-19 and 2019-20 and due during 2019-20 and 2020-21 respectively, may be
consolidated separately and marked as an 'Additional Claim' duly certified by the
Statutory Auditor as true and correct.
iii) Claims in respect of 2% interest subvention and 3% prompt repayment incentive
may be submitted within a quarter from the close of the half year/year. The
‘Additional Claim’ pertaining to the disbursements made during the years 2018-19 and
2019-20 may be submitted latest by June 30, 2020 and June 30, 2021 respectively.
The above mentioned claims may be submitted in Formats I and II (enclosed
herewith) to the Chief General Manager, Financial Inclusion and Development
Department, Reserve Bank of India, Central Office, Shahid Bhagat Singh Marg, Fort,
Mumbai – 400 001 both in hard copy and soft copy (excel format) to fsdco@rbi.org.in.
iv) The copies of such audited claims may also be submitted to the Department of
Animal Husbandry and Dairying, Ministry of Fisheries, Animal Husbandry and
Dairying, Government of India and Department of Agriculture Cooperation and
Farmers Welfare, Ministry of Agriculture & Farmers Welfare, Government of India.
Yours faithfully,
(Sonali Sen Gupta)
Chief General ManagerFormat I
Claim for 2% Interest Subvention on Short-term Loans to Animal Husbandry/ Fishery (please tick) farmers up to ₹ 2 lakh for
the year 2018-19 / 2019-20
Name of the Bank: ___________________________________________________
Statement for the half year / year ended on
September 20__ / March 20__ / Additional Claim
Total short term credit at 7% p.a Amount of total subvention
No. of accounts Amount Disbursed / drawn claimed
(in thousands) (₹ lakh) (₹ in actuals)
Loans up to ₹2 lakh
Category-wise claim for 2% Interest Subvention for 2018-19 / 2019-20 for All India other than North East region
Total short term credit at 7% p.a. for All India other than North East region
General SC ST
Amount Amount of Amount Amount of Amount Amount of
No. of No. of No. of
Disbursed/ subvention Disbursed/ subvention Disbursed/ subvention
accounts accounts accounts
drawn claimed drawn claimed drawn claimed
(in (in (in
(₹ lakh) (₹ in actuals) (₹ lakh) (₹ in (₹ lakh) (₹ in actuals)
thousands) thousands) thousands)
actuals)
Loans up to ₹2
lakh
Category-wise claim for 2% Interest Subvention for 2018-19 / 2019-20 for North East region
Total short term credit at 7% p.a. for North East region
General SC ST
Amount Amount of Amount Amount of Amount Amount of
No. of No. of No. of
Disbursed/ subvention Disbursed/ subvention Disbursed/ subvention
accounts accounts accounts
drawn claimed drawn claimed drawn claimed
(in (in (in
(₹ lakh) (₹ in actuals) (₹ lakh) (₹ in (₹ lakh) (₹ in actuals)
thousands) thousands) thousands)
actuals)
Loans up to ₹2
lakh
We certify having disbursed the above loans at 7% p.a. up to ₹ 2 lakh by way of short-term credit to the fishery/animal husbandry
farmers during the year 2018-19 / 2019-20 and calculated the interest subvention claim correctly strictly in accordance with the RBI
circular FIDD.CO.FSD.BC.No. 10 /05.02.001/2019-20 dated August 26, 2019.
Seal and signature of authorised signatory
Name: ___________________________
Designation: ______________________
Date: _________ Seal of Bank:
We certify that the above claim for interest subvention of Rs. _____ calculated on eligible short term credit to fishery/ animal
husbandry farmers disbursed by the bank (Name of the Bank) during the period from _____ to _____ has been found true and
correct and strictly in accordance with the RBI circular FIDD.CO.FSD.BC.No. 10 /05.02.001/2019-20 dated August 26, 2019.
.
Seal and signature of Statutory Auditor
Name: _________________________
Firm Registration Number: _________
Date: ________ Membership Number: _____________Format II
One - time claim for 3 per cent interest subvention for timely repayment of short-term loans to Animal Husbandry /
Fishery (please tick) farmers up to ₹ 2 lakh disbursed in 2018-19 / 2019-20
Name of the Bank: _____________________________________________________
Amount of additional
Total short term credit which were
Total short term credit at 7% p.a subvention claimed
repaid in time
@ 3% (₹ in actuals)
No. of Amount Disbursed/ No. of Amount Disbursed/
accounts drawn accounts drawn
(in thousands) (₹ lakh) (in thousands) (₹ lakh)
Loans up to ₹2
lakh
Category-wise one-time claim for additional 3% Subvention for 2018-19 / 2019-20 for All India other than North East region
Total short term credit which were repaid in time for All India other than North East region
General SC ST
Amount Amount of Amount Amount of Amount Amount of
No. of No. of No. of
Disbursed/ subvention Disbursed/ subvention Disbursed/ subvention
accounts accounts accounts
drawn claimed drawn claimed drawn claimed
(in (in (in
(₹ lakh) (₹ in actuals) (₹ lakh) (₹ in (₹ lakh) (₹ in actuals)
thousands) thousands) thousands)
actuals)
Loans up to ₹2
lakh
Category-wise one-time claim for additional 3% Subvention for 2018-19 / 2019-20 for North East region
Total short term credit which were repaid in time for North East region
General SC ST
Amount Amount of Amount Amount of Amount Amount of
No. of No. of No. of
Disbursed/ subvention Disbursed/ subvention Disbursed/ subvention
accounts accounts accounts
drawn claimed drawn claimed drawn claimed
(in (in (in
(₹ lakh) (₹ in actuals) (₹ lakh) (₹ in (₹ lakh) (₹ in actuals)
thousands) thousands) thousands)
actuals)
Loans up to ₹2
lakh
We certify that the above mentioned short term loans for which the claim is being made were repaid in time and the benefit of additional
3 percent subvention has already been passed on to the eligible loanee farmers, thereby bringing down the interest rate to 4 per cent per
annum for short term credit for Animal Husbandry / Fishery, up to ₹ 2 lakh disbursed during 2018-19 / 2019-20 for these farmers. This
claim for additional interest subvention has been calculated on eligible short term credit to fishery/animal husbandry famers strictly in
accordance with the RBI circular FIDD.CO.FSD.BC.No. 10 /05.02.001/2019-20 dated August 26, 2019.
Seal and signature of authorized signatory
Name: ___________________________
Designation: ______________________
Date: _________ Seal of Bank:
We certify that the above claim for 3% additional interest subvention of Rs. _____ calculated on eligible short term credit to fishery/
animal husbandry farmers disbursed by the bank (Name of the Bank) during the period from _____ to _____ has been found true and
correct and strictly in accordance with the RBI circular FIDD.CO.FSD.BC.No. 10 /05.02.001/2019-20 dated August 26, 2019.
Seal and signature of Statutory Auditor
Name: _________________________
Firm Registration Number: _________
Date: ________ Membership Number: _____________Illustrations
Illustration I
Overall KCC limit - ₹ 2.5 lakhs
Limit under Crop loan - ₹ 1.5 lakhs
Sub-limit KCC for Animal Husbandry and / or fisheries – ₹ 1 lakh
Interest subvention/PRI benefit will be available on overall ₹ 2.5 lakhs i.e.
• ₹ 1.5 lakhs crop loan + ₹ 1 lakh animal husbandry and / or fisheries
Illustration II
Overall KCC limit - ₹ 3 lakhs
Limit under Crop loan - ₹ 0.5 lakh
Sub-limit KCC for Animal Husbandry and / or fisheries – ₹ 2.5 lakhs
Interest subvention/PRI benefit will be available on overall ₹ 2.5 lakhs i.e.
• ₹ 0.5 lakh crop loan + ₹ 2 lakhs animal husbandry and / or fisheries
Illustration III
Overall KCC limit - ₹ 4 lakhs
Limit under Crop loan - ₹ 1.75 lakhs
Sub-limit KCC for Animal Husbandry and / or fisheries – ₹ 2.25 lakhs
Interest subvention/PRI benefit will be available on overall ₹ 3 lakhs i.e.
• ₹ 1.75 lakhs crop loan + ₹ 1.25 lakhs animal husbandry and / or fisheries
Illustration IV
Overall KCC limit - ₹ 4.5 lakhs
Limit under Crop loan - ₹ 2 lakhs
Sub-limit KCC for Animal Husbandry and / or fisheries – ₹ 2.5 lakhs
Interest subvention/PRI benefit will be available on overall ₹ 3 lakhs i.e.
• ₹ 2 lakhs crop loan + ₹ 1 lakh animal husbandry and / or fisheries
Illustration V
Overall KCC limit - ₹ 4 lakhs
Limit under Crop loan - ₹ 3.15 lakhs
Sub-limit KCC for Animal Husbandry and / or fisheries – ₹ 0.85 lakh
Interest subvention/PRI benefit will be available on overall ₹ 3 lakhs for crop loan component only
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