Lok Sabha Question No. 3857 (UNSTARRED), answered on 2025-08-12
Subject: Modified Interest Subvention Scheme
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: Shri Basavaraj Bommai

## GOVERNMENT OF INDIA MINISTRY OF AGRICULTURE AND FARMERS WELFARE

## DEPARTMENT OF AGRICULTURE AND FARMERS WELFARE

## LOK SABHA UNSTARRED QUESTION No. 3857

TO BE ANSWERED ON THE 12 TH  AUGUST, 2025

## MODIFIED INTEREST SUBVENTION SCHEME

3857. SHRI BASAVARAJ BOMMAI: Will the Minister of AGRICULTURE AND FARMERS WELFARE कृ ͪष एवं ͩकसान कãयाण मंğी be pleased to state: (a) whether the Government approves continuation of Modified Interest Subvetnion Scheme (MISS) aimed at ensuring the availability of short-term credit to farmers at an affordable interest rate; (b) if so, the details thereof and the number of farmers presently availing Short-Term Agriculture  Operation  loans  under  the  MISS  through  Kisan  Credit  Cards  in  the country, State- wise particularly in the State of Karnataka; (c) the latest total amount of interest subvention disbursed to financial institutions under the scheme; (d) whether some of the Primary Agricultural Credit Societies and other cooperative institutions  are  implementing  the  scheme  and  if  so,  the  details  thereof  and  the volume of credit routed through them; and (e) the steps taken by the Government to strengthen the rural credit ecosystem and
2. to boost agricultural growth through timely and affordable credit access?

## ANSWER

THE MINISTER OF STATE FOR AGRICULTURE AND FARMERS WELFARE कृ ͪष एवं ͩकसान कãयाण राÏय मंğी (SHRI RAMNATH THAKUR)

- (a) to (c): Yes sir. The Government has approved the continuation of the Modified Interest  Subvention  Scheme  (MISS)  for the F.Y.  2025-26.  This  scheme  aims to provide  concessional  interest  rates  on  short-term  agricultural  loans  obtained  by farmers through Kisan Credit Cards (KCC) for their working capital requirements.

Under this scheme, farmers receive KCC loans at a subsidized interest rate of 7%. To facilitate this, an up front interest subvention (IS) of 1.5% is provided to financial institutions. Additionally, farmers who repay their loans promptly receive a 3% Prompt Repayment Incentive (PRI), effectively reducing the interest rate to 4% per annum. The benefits of IS and PRI are available for loan limits up to Rs.3 lakhs. However,  if  the  short-term  loan  is  taken  for  allied  activities  (other  than  crop husbandry), the loan amount is limited to Rs.2 lakhs only.

Details of State wise number  of operative KCC  accounts  including Karnataka, as on 31 March 2025, is at Annexure-I . The total interest subsidy (both Interest Subvention and Prompt Repayment Incentive) disbursed under MISS for the year 2024-25 is as under:

(Amount in Rs. Cr)

|   S. No. | Year    |   Disbursement of funds |
|----------|---------|-------------------------|
|        1 | 2024-25 |                 17811.7 |

(d):  Yes  Sir.  Rural  Cooperative  Banks  (RCBs)  viz.,  District  Central  Cooperative Banks (DCCBs) and State Cooperative Banks (StCBs) are implementing the Kisan Credit  Card  (KCC)  Scheme  The  details  of  Operative  KCC  accounts  in  Rural Cooperative Banks (RCBs) as on 31 March 2025 are as under:

(Amount in Rs. Cr)

| Bank                                            | No. of Operative KCCs   | Credit Extended   |
|-------------------------------------------------|-------------------------|-------------------|
| Rural Cooperative Banks                         | 3,34,29,368             | 2,20,260.24       |
| Total Operative KCC (PSBs, PvBs, RRBs and RCBs) | 7,72,10,538             | 10,20,071.63      |

Source: RBI and NABARD

PSBs: Public Sector Banks; PvBs: Private Sector Banks; RRBs: Regional Rural Banks

(e): The following steps have been taken to strengthen the rural credit ecosystem and to boost agriculture growth through timely and affordable credit:-

- i. It  has  been  constant  endeavour  of  the  Government  to  boost  agriculture sector through effective and hassle-free credit, for which the Government sets Ground Level Credit (GLC) Target for agriculture sector. The average achievement under agriculture credit  during  the  last  5  years  (2020-21  to 2024-25) has been nearly 113% of the target. Agriculture credit target for year 2025-26 has been set at ₹32.50 lakh crore with a sub-target of ₹ 5.0 lakh crore for Animal Husbandry, Dairying and Fisheries farmers.
- ii. As per priority Sector Landing (PSL) regulation government has mandated that  banks  will  provide  18%  of  their  total  loans  to  agriculture  and  allied sector. Since 2016 a sub limit has been fixed for small and marginal farmers which at present is 10%.
- iii.  The government is implementing a 100% centrally funded Central Sector Scheme known as the Modified Interest Subvention Scheme (MISS) across various  States  and  UTs  in  pan  India.  This  scheme  aims  to  provide concessional  interest  rates  on  short-term  agricultural  loans  obtained  by farmers  through Kisan  Credit  Cards  (KCC) for  their  working  capital requirements.
- iv.  Due  to  KCC-MISS  scheme  access  to  easy  and  affordable  credit  has increased  significantly  to  farmers  to  meet  their  operational  needs.  The number of operative KCC accounts has reached to 7.72 crore in 2024-25, which has contributed to an increase in credit extended amount from ₹4.26 lakh crore in 2013-14 to ₹10.20 lakh crore in 2024-25.
- v. Over the past eleven years, farmers has availed ₹1.62 lakh crore as interest subvention on loans through KCCs.
- vi.  Similarly, the total credit flow to the agriculture sector has nearly grown four times rising from ₹7.3 lakh crore in 2013-14 to ₹28.69 lakh crore in 202425.
- vii.  Recently, RBI has increased collateral free loan limit in KCC for existing Rs 1.6  lakh  to  Rs  2  lakh  w.e.f.,  01.01.2025.  This  move  enhances  credit accessibility, particularly for small and marginal farmers, who benefit from reduced borrowing costs and the removal of collateral requirements.
- viii. Government have been taking multiple initiative to make this accessible to farmers through regular  IEC  campaigns  organized by banks, State Government/ Central Government, RBI, NABARD, etc, besides, technology intervention like Kisan Rin Portal (KRP).

*****