In farming you can’t tell when you need something. Sometimes you suddenly need money for seeds and fertilizers, and sometimes the budget for tractor repairs or irrigation equipment. At such times, farmers often get trapped in a cycle of expensive debt. Where they have to pay heavy interest.
The government’s Kisan Credit Card (KCC) scheme is proving to be a great help to save them from this problem. Through this card, farmers get loans at very low interest rates. So that they can meet their farming needs on time. But before applying for KCC, it is very important to understand some basic and important things. So that your application is not rejected later and you do not have to cut the bank’s wheels.
What to Check Before Applying for a Kisan Credit Card (KCC)?
Check your Eligibility
To avail the benefits of Kisan Credit Card, first you need to check your eligibility and documents. This card is available only to those who have cultivable land in their name. If you are a tenant farmer or sharecropper, you can still be eligible for it, you just need to have the right agreement.
Check the Important Documents Before Applying
- Talking about documents, you must have a valid land title deed.
- A government ID as a proof of identity,
- A residence proof
- A recent passport size photograph.
- The most important thing is that your CIBIL Score should be good and you should not have defaulted on any loan in any other bank. Otherwise, the bank manager may hesitate in approving your loan.
Know Interest Rate
The biggest feature of KCC is its very cheap interest rate. But it is important to understand its rates. The base interest rate is around 9%, but the government gives a 2% subsidy on it. So it directly comes to 7%.
Discounts are Available Separately
- If you repay the loan amount to the bank on time or before the due date, then the government gives you an additional discount of 3%. This means that you will have to pay interest at a nominal rate of 4%.
- Another big benefit of repaying money on time is that the bank increases the credit limit of your card for the next year. So that you can get more loans in the future.
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