- NEW DELHI — The Union Cabinet, chaired by Prime Minister Narendra Modi, on
Wednesday approved the continuation of the interest subvention component under
the modified interest subvention scheme (MISS) for loans to farmers during the
financial year 2025-26, and approved the required fund arrangements, according
to an official statement issued after the meeting.
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- MISS is a Central sector scheme aimed at ensuring the
availability of short-term credit to farmers at an affordable interest rate
through Kisan credit cards (KCC).
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- Under the scheme, farmers receive short-term loans of up
to INR 3 lakh through kisan credit cards at a subsidised interest rate of 7 per
cent with 1.5 per cent interest subvention provided to eligible lending
institutions.
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- Additionally, farmers repaying loans promptly are
eligible for an incentive of up to 3 per cent as a prompt repayment incentive,
effectively reducing their interest rate on KCC loans to 4 per cent.
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- For loans taken exclusively for animal husbandry or
fisheries, the interest benefit is applicable up to INR 2 lakh.
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- No changes have been proposed in the structure or other
components of the scheme, according to an official statement.
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- There are more than 7.75 crore KCC accounts in the
country. The continuation of this support is critical to sustaining the flow of
institutional credit to agriculture, which is vital for enhancing productivity
and ensuring financial inclusion for small and marginal farmers.
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