Empowering Farmers Through Financial Inclusion: A Study On The Effectiveness Of Kisan Credit Cards

Abstract

The Kisan Credit Card (KCC) scheme, introduced in 1998, represents a transformative step toward financial inclusion in India’s agricultural sector. Designed to provide farmers with easy access to institutional credit, the scheme addresses critical needs, including crop production, post-harvest management, and allied activities such as animal husbandry and fisheries. Over the years, the KCC scheme has played a significant role in enhancing agricultural productivity, reducing dependence on informal lenders, and improving rural livelihoods. This study evaluates the socio-economic impact of the KCC scheme, drawing insights from a review of key literature, statistical data from government reports, and primary data collected through surveys and interviews. Findings reveal a steady growth in KCC adoption, with over 30 million cards issued by 2023, facilitating the disbursement of ₹8.5 lakh crores. However, challenges persist, including limited awareness, procedural hurdles, regional disparities, and low adoption of digital platforms. The research highlights critical areas for policy intervention, such as simplifying processes, promoting digital literacy, and extending the scheme’s benefits to tenant farmers and agricultural laborers. Recommendations also include the integration of KCC with other government schemes and enhanced monitoring mechanisms to ensure equitable and efficient implementation. By addressing existing challenges and leveraging modern tools, the KCC scheme can become a model of financial empowerment for farmers, fostering a resilient and inclusive agricultural sector. This article provides actionable insights for policymakers, financial institutions, and stakeholders aiming to enhance the scheme’s impact and sustainability.