The Kisan Credit Card Extension for Fishermen: A Path to Financial Stability and Sustainability
In the year 2018-19, the Government of India introduced a significant financial initiative called the Kisan Credit Card (KCC) to support fishers and fish farmers in meeting their working capital needs. This extension was made possible through various means, including an up-front interest subvention and a prompt repayment incentive.
The Kisan Credit Card: A New Dawn
The KCC loan scheme was introduced under the title “Loan for Fishermen,” designed to alleviate financial burdens faced by fishermen and fish farmers. With loans ranging up to ₹2.00 Lakhs, the initiative aimed to bridge the gap between their livelihoods and financial obligations.
Key Features of the KCC Loan Scheme
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Subsidized Interest Rate: fishermen received a subsidized interest rate of 7% per annum, making the scheme more accessible to those incurring debt.
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Prompt Repayment Incentive: Fishermen who paid their loans on time received an additional 3% Prompt Repayment Incentive (PRI), effectively reducing the interest rate to 4%.
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Collateral-Free Loan Limits: The loan limits were increased from ₹1.60 lakh to ₹2.00 lakh, with further enhancements under the modified interest subvention in the 2025-26 budget.
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Enhanced Credit Access: Fishers now receive up to 4,63,492 KCC cards issued in recent years, with loans totaling ₹2982.58 crore across States and UTs.
The Support from External Initiatives
In addition to the KCC scheme, several other initiatives played a crucial role:
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Fisheries and Aquaculture Infrastructure Development Fund (FIDF): This fund provided concessional financing for development projects, with up to 3% interest subvention for NLEs.
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Pradhan Mantri Matsya Sampada Yojana (PMMSY): The government launched this scheme in 2021-22 and onwards, offering Group Accidental Insurance Coverage to fishers. It includes insurance for death or disability, partial disability, and hospitalization expenses up to ₹25,000.
The Impact of These Initiatives
- Statistics: Over 4,63,492 KCC cards were issued in recent years, with a total loan amount exceeding ₹20 crore.
- Fishery Enrolments: The PMMSY scheme has helped more fishermen by addressing their financial barriers, reducing reliance on external credit and improving their livelihoods.
The Future of the KCC
While the KCC extension is now operational, the government continues to explore future enhancements. Plans include expanding the loan scope, refining the interest calculation methods, and exploring partnerships with NGOs and international organizations for broader support.
Conclusion: The KCC Loan Scheme, supported by a combination of subsidized loans,Prompt Repayment Incentives, and enhanced access under FIDF and PMMSY, is proving to be a vital tool in supporting fishermen and fish farmers. As the government continues to adapt its approach, the ultimate aim remains to promote sustainable livelihoods through financial stability and social inclusion.