Kisan Credit Card Loan: A few days before the start of the first phase of Lok Sabha Elections 2019, the Bharatiya Janata Party (BJP) today promised to provide short-term new agriculture loans up to Rs 1 lakh at a Zero per cent interest rate for 1-5 years on the condition of prompt repayment of the principal amount. "We will provide sho-term new agriculture loans up to Rs. 1 lakh at a 0% interest rate for 1-5 years on the condition of prompt repayment of the principal amount," the BJP manifesto said. 

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At present, farmers can get loans with the Kisan Credit Card (KCC), which is an initiative of the Government of India. It aims to provide farmers' access to credit at an affordable rate. KCC was first launched in 1988. KCC is also often referred to as Kisan Credit Card Loan as it provides term loans to farmers to help them cover the cost of agricultural inputs including cultivation, harvest and farm maintenance. A Ministry of Finance statement says, "The Kisan Credit Card (KCC) Scheme was introduced in 1998 for issue of KCC to farmers so that farmers may use them to readily purchase agriculture inputs such as seeds, fertilizers, pesticides etc. and draw cash for their production needs. The KCC scheme has since been simplified and provides for issue of ATM enabled RuPay Debit Card, inter alia, with facilities of one-time documentation, built-in cost escalation in the limit, and any number of drawals within the limit, etc."

Currently, KCC provides the facility of ATM enabled RuPay Card, one-time documentation, built-in cost escalation in the limit and any number of withdrawals within the limit, says the ministry.

Eligibility: Small farmers, marginal farmers, sharecroppers, oral lessee and tenant farmers, Self Help Groups (SHGs) or Joint Liability Groups (JLGs) are eligible for KCC benefits. 

As per the official SBI website, features and benefits of KCC include:

- SBI offers interest at saving bank rate on credit balance in the KCC account.
- A KCC holder also gets a free ATM-cum-debit card.
- SBI is providing interest subvention at 2 per cent per annum for loan amount up to Rs 3 Lakh. 
- The SBI provides an additional interest subvention at 3 per cent per annum for prompt repayments.

Highlights of BJP manifesto 2019

Quantum of Loan: The quantum of loan is assessed by the lender on the basis of the cost of cultivation, post-harvest expense and farm maintenance cost. Increase in the scale of finance will determine the subsequent 5-year loan. 

Interest rate: SBI charges 7% interest for one year, or up to the repayment of the due date of loan date, or whichever is earlier. If a borrower fails to repay the loan within the due date, the interest is applied at the card rate. Also, the interest is compounded half-yearly after the due date. The Punjab National Bank also charges 7 per cent interest on loan up to Rs 3 lakh.

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The interest rate and some other conditions of KCC may differ from one lender to another.