Kisan Credit Card Scheme in India: Growth, Utilisation Patterns, Impact and Implementation Constraints

Abstract

In 1998, India launched Kisan Credit Cards to give farmers easy access to timely credit for crop needs, replacing costly moneylenders who charged 24-36 per cent interest. This review synthesises various studies from the last 20 years and RBI, NABARD data, tracing KCC growth from just 22,000 cards to 7.72 crore accounts with ₹9.8 lakh crore outstanding by 2023-24. From this review, the findings indicate that KCC helps farmers get formal credit, spend more on inputs, work more efficiently, earn higher incomes, and reduce dependence on informal credit. This review finds farmers using KCC spend 24-38 per cent more on seeds and fertilisers, achieve 12-18 per cent higher technical efficiency, see incomes rise 15-22 per cent, and cut moneylender dependence (45-22%). Major part of KCC funds go to productive farming uses, though small farmers who hold 86 per cent of cards often divert for household expenses, social events, or informal debts. The study also examines key constraints including tenants facing documentation barriers, credit limits failing to match 6.8% annual agricultural inflation, bank branch rigidities causing withdrawal delays, and low insurance uptake at just 28% among beneficiaries. Researchers suggest practical solutions: video KYC camps, flexible credit limits, tenant group lending, RuPay card machines at rural shops, and better spending tracking. Future studies should examine actual transaction patterns, test tenant-focused approaches, and address digital gaps to help all 14 crore farm households benefit from KCC.