Lok Sabha Question No. 3661 (UNSTARRED), answered on 2018-03-16
Subject: Credit Card Facility for Farmers
Ministry: FINANCE
Asked by: VIJAYSINH MOHITE PATIL, HEENA VIJAYKUMAR GAVIT, SUPRIYA SADANAND SULE, DHANANJAY BHIMRAO MAHADIK, RAJEEV SHANKARRAO SATAV, P.R. SUNDARAM, JAYAKUMAR JAYAVARDHAN

## Government of India Ministry of Finance

## Department of Financial Services LOK SABHA

Unstarred Question No. 3661

To be answered on Friday, March 16, 2018/Phalguna 25, 1939 (Saka)

## Credit Card Facility for Farmers

3661. SHRI MOHITE PATIL VIJAYSINH SHANKARRAO: DR. HEENA VIJAYKUMAR GAVIT: SHRIMATI SUPRIYA SULE: SHRI DHANANJAY MAHADIK: SHRI SATAV RAJEEV: SHRI P.R. SUNDARAM: DR. J. JAYAVARDHAN.

Will the Minister of FINANCE be pleased to state:

- (a) whether the State Bank of India (SBI) has launched the credit card facility for the farmers nationwide, if so, the details thereof along with the main key features of credit card facility extended to farmers;
- (b) whether the SBI has launched this facility as pilot basis in some States, if so, the details thereof along with the time by which it will be extended to other parts of the country;
- (c) the details of applications received from farmers for issue of credit cards till date; and
- (d) the steps taken by the Government to provide financial assistance for purchasing their goods and machineries at a much reduced rate of interest against credit availed?

## Answer The Minister of State in the Ministry of Finance

(Shri Shiv Pratap Shukla )

(a) to (c): State Bank of India (SBI) has reported that with the objective of providing farmer's genuine credit requirements, it has launched Krishak Unnati Card (Credit Card facility) for the farmers in the month of January, 2018 on a pilot basis in select few  States  (Madhya  Pradesh,  Rajasthan  &  Gujarat).  Based  on  the  response  and feedback of farmers the facility will be extended to other States in phases.

The key features of Krishak Unnati Card (Credit Card facility) are at Annexure.

As  reported  by  SBI,  a  total  number  of  580  applications  have  been  received  from farmers for issuance of credit card as on 06.03.2018.

- (d) With a view to ensuring availability of agriculture credit at a reduced interest rate of 7% p.a. to the farmers, the Government of India in the Department of Agriculture, Cooperation  and  Farmers'  Welfare  implements  an  interest  subvention  scheme  for short term crop loans up to Rs3.00 lakh. The scheme provides interest subvention of 2%  per  annum  to  Banks  on  use  of  their  own  resources.    Besides,  additional  3% incentive is given to the farmers for prompt repayment of the loan, thereby reducing the effective rate of interest to 4%.

To encourage long term investment credit in agriculture, NABARD provides refinance to Cooperative Banks and RRBs out of Long Term Rural Credit Fund (LTRCF), at a concessional  rate  of  interest,  which  is  currently  at  4.65%.  The  rate  of  interest  to ultimate  beneficiaries  is  as  per  Bank's  loan  policy  within  the  framework  of  RBI instructions.

## Krishak Unnati Card - Key Features

Objective: To ensure standby credit arrangement for farmers over and above KCC loan  limits  sanctioned  to  meet  the  unexpected  /unforeseen  emergency  expenses towards  Agriculture  and  allied  agricultural  activities,    to  empower  and  encourage farmers  the use of  digital payment channels and  to provide level playing field to farmers  to  avail  discount  officers  made  by  SBI  Cards  on  various  e-commerce platforms.

Eligibility: Farmers enjoying KCC limits of Rs. 5 Lacs and above having completed two renewals/ reviews and regular with either Housing loan/ Car Loan/ ATL.

Purpose: To meet the cost of sudden breakdown of farm/irrigation equipment, fuel cost,  mandi  /storage  cost  in  case  of  uncertainty  in  prices  of  Agri  commodities, increasing labour charges during peak sowing /harvesting and allied activities, etc.,

Quantum of limit: 20% of KCC loan limit availed from SBI with a maximum limit of Rs.1,00,000/-

Interest rate: Interest free credit period could range from 20 to 50 days based on the usage of card. If the card due payment is not paid on due date, an interest rate of 13.40% p.a. (1yr MCLR + 5.25%) is charged.

Validity:

Three years.

## Benefits:

-  Krishak Unnati Card is free for first year, i.e., 0 membership fee
-  2nd  year  onwards,  renewal  fee  of  Rs.499  to  be  waived  on  annual  spends  of Rs.30,000
-  Krishak Unnati Card comes with credit free period of 20-50 days
-  Reward Points on regular spends
- o 5 Reward Points per Rs.100 spent on Utility Bill Payments and Fuel spends
- o 1 Reward Points per Rs.100 spent on all other categories
- o These reward points can be redeemed against outstanding balance or against host of gift option from SBI Card Rewards Catalogue
-  Freedom from Fuel Surcharge - 1% Surcharge waiver across all fuel pumps in India
-  Rs.500 Cashback on annual spends of Rs.50,000

## Annexure