RBI vide circular dated April 28, 2022 has modified the Interest Subvention Scheme for Short Term Loans for Agriculture and Allied Activities availed through Kisan Credit Card (KCC) during the financial year 2021-22. Government of India has approved the continuation of the Interest Subvention Scheme (ISS) with modifications for the financial year 2021-22.
In order to discourage distress sale by farmers and to encourage them to store their produce in warehouses, the benefit of interest subvention under KCC will be available to small and marginal farmers for a further period of upto six months post the harvest of the crop against negotiable warehouse receipts on the produce stored in warehouses accredited with Warehousing Development Regulatory Authority (WDRA), at the same rate as applicable to the agri. loan.
With a view to providing relief to farmers affected by natural calamities, the interest subvention of 2% per annum will be made available to banks as stated in the table given in para 2(i) above, for the first year on the restructured loan
amount. Such restructured loans will attract normal rate of interest from the second year onwards.
