**Policy Summary: Expansion of Kisan Credit Card Access Through Cooperative Societies**
In response to Lok Sabha Unstarred Question No. 1588, the Ministry of Cooperation outlines the government's initiative to expand access to Kisan Credit Cards (KCCs) for members of cooperative societies. This initiative stems from the Prime Minister's vision of "Sahakar Se Samriddhi" (Prosperity through Cooperation).
A pilot project promoting cooperation among cooperatives was initially launched on May 21, 2023, in the Banaskantha and Panchmahal districts of Gujarat. Following its success, a statewide campaign was launched in all districts of Gujarat on January 15, 2024. Based on these experiences, a Standard Operating Procedure (SOP) for nationwide implementation of the campaign was issued on September 19, 2024.
A key objective of this campaign is the distribution of RuPay KCCs to members of Primary Agricultural Credit Societies (PACS), Primary Dairy Cooperative Societies (PDCS), and other cooperative societies. The RuPay KCCs aim to provide concessional loan facilities at zero or low interest rates through interest subvention.
The RuPay KCC offers several financial benefits, including easier access to short-term credit for agricultural needs, facilitated digital transactions, reduced reliance on cash and informal lenders, and access to government interest subvention schemes.
The central government provides a 1.5% interest subvention. An additional 3% subvention is offered as a prompt repayment incentive, effectively reducing the interest rate to 4%. Certain states provide further interest subventions to cover the remaining 4%, resulting in farmers who repay loans on time effectively paying 0% interest on loans up to ₹3 lakh. This significantly reduces the interest burden, promotes timely repayment, enhances access to affordable institutional credit, and enables greater investment in farming inputs, ultimately improving productivity and income.
Key Entities Referenced
Kisan Credit Card: A credit card scheme to provide short-term credit to farmers for agricultural needs.
RuPay Kisan Credit Card: A version of the Kisan Credit Card that facilitates digital transactions.
Ministry of Cooperation: The Indian government ministry responsible for cooperation.
Sahakar Se Samriddhi: A mantra to achieve prosperity through cooperation.
Banaskantha District of Gujarat: One of the pilot project locations for promoting Cooperation among Cooperatives.
Panchmahal District of Gujarat: One of the pilot project locations for promoting Cooperation among Cooperatives.
Primary Agricultural Credit Societies (PACS): A type of cooperative society involved in providing credit to farmers.
Primary Dairy Cooperative Societies (PDCS): A type of cooperative society involved in diary farming and production.
GOVERNMENT OF INDIA
MINISTRY OF COOPERATION
LOK SABHA
UNSTARRED QUESTION NO. 1588
ANSWERED ON 29.07.2025
KISAN CREDIT CARDS TO COOPERATIVE SOCIETIES
1588. Shri Shankar Lalwani:
Will the Minister of Cooperation (सहकारिता मंत्री) be pleased to state:
(a); whether Kisan Credit Cards are now being distributed to the members of
cooperative societies under a campaign;
(b); if so, the details thereof; and
(c); the manner in which the RuPay Kisan Credit Card is likely to provide financial
benefits to the Members?
ANSWER
THE MINISTER OF COOPERATION
सहकारिता मंत्री (SHRI AMIT SHAH)
(a) to (b); Yes Sir. To achieve the prosperity in the country through the mantra of “Sahakar
Se Samriddhi” given by the Prime Minister, a pilot project to promote ‘Cooperation among
Cooperatives’ was launched on 21st May, 2023 in Banaskantha and Panchmahal Districts
of Gujarat. After the success of the pilot project, a statewide campaign on ‘Cooperation
among Cooperatives’ was launched in all the districts of Gujarat on January 15, 2024.
Based on the experiences of the pilot project, a Standard Operating Procedure (SOP) for
nationwide implementation of the campaign was issued on 19.09.2024.
One of the objectives of the Campaign is distribution of RuPay Kisan Credit Cards
(KCC) to all members of Primary Agricultural Credit Societies (PACS), Primary Dairy
Cooperative Societies (PDCS) and other cooperative societies to provide concessional
loan facility to them at zero or low interest rate (interest subvention).
(c) The RuPay Kisan Credit Card (KCC) enables easy access to short-term credit for
agricultural needs, facilitates digital transactions, reduces dependency on cash and
informal lenders, and allows farmers to avail interest subvention benefits undergovernment schemes, all while promoting financial inclusion through a secure and
interoperable payment platform.
Interest subvention under the Kisan Credit Card (KCC) scheme provides direct
financial benefits to members of cooperative societies by reducing the cost of borrowing
for agricultural and allied activities. The Central Government provides an interest
subvention of 1.5%. In addition, farmers who repay the loan on or before the due date get
another 3% subvention as a prompt repayment incentive given by Government of India.
This brings down the effective interest rate to 4% only.
Certain States provide further interest subvention that cover the remaining interest
of 4%. As a result, farmers who repay loans on time effectively pay 0% interest on loans
up to ₹3 lakh, making credit through Primary Agricultural Credit Societies completely
interest-free in such cases.
This significantly reduces their interest burden, promotes timely repayment,
enhances access to affordable institutional credit, and enables greater investment in
farming inputs, thereby improving their productivity and income.