Latest Update (May 2025):
The Indian Union Cabinet has granted approval for the Interest Subvention (IS) element of the Modified Interest Subvention Scheme (MISS) to proceed during Fiscal Year 2025-26.
Scheme Overview:
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MISS operates as a Central Sector Scheme (fully funded by the Government of India).
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Its core objective is to facilitate affordable short-term agricultural financing for cultivators.
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This financial access is primarily delivered via the Kisan Credit Card (KCC) system.
Key Provisions:
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Subsidized Interest Rate: Eligible financial institutions provide short-term loans capped at ₹3 lakh through Kisan Credit Cards (KCCs) to farmers at a 7% annual interest rate. The government supports this rate by granting these institutions a 1.5% interest subsidy.
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Prompt Repayment Incentive (PRI): Borrowers who repay their loans on schedule qualify for an additional benefit of up to 3%, effectively lowering their net interest cost to just 4% per annum.
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Special Focus Sectors: For credit utilized specifically in animal husbandry or fisheries activities, the interest subsidy applies to loans up to ₹2 lakh.
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Continuity: The fundamental structure and existing components of the program remain unchanged for the upcoming financial year.
Implementation & Oversight:
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The Reserve Bank of India (RBI) and the National Bank for Agriculture and Rural Development (NABARD) are jointly responsible for executing and supervising the scheme.
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A network of lending institutions, including Public Sector Banks, Regional Rural Banks (RRBs), Cooperative Banks, and eligible Private Sector Banks serving rural and semi-urban locations, delivers these interest benefits directly to farmers.
Frequently Asked Questions (FAQs):
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Q: When did the Modified Interest Subvention Scheme commence?
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Ans: The scheme was initially launched during the 2006-07 financial year.
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Q: What does KCC signify?
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Ans: KCC stands for Kisan Credit Card. It represents a specialized government-backed agricultural credit instrument issued to eligible farmers by authorized lenders across India.
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