Why in news? Among five States in southern India, Karnataka has the highest operative Kisan Credit Cards (KCCs) issued by cooperative banks, regional rural banks, and commercial banks

Highlights

• Andhra Pradesh secured second position followed by Telangana, Tamil Nadu and Kerala, according to the RBI’s “Report on Trends and Progress of Banking in India 2021-22”

Karnataka’s Performance

• In cooperative banks, again Karnataka topped the list with an existence of operative of 31.25 lakh KCCs
• The recovery of loans issued by cooperative banks in Karnataka recorded at 1% against the southern region’s average of 90.9%( as on June 2020)

RRBs in various States

• KCCs issued by Regional Rural Banks is highest in Telangana followed by Andhra Pradesh, Karnataka, and Kerala.

Commercial banks

• Highest in Kerala Andhra Pradesh, Tamil Nadu, and Telangana(March 2022).

About Kisan Credit Cards

• a credit scheme introduced in 1998 by Indian public sector banks
• Model scheme : By the NABARD on the recommendations of the R. V. Gupta Committee to provide advances for agricultural needs.
• Objective : To meet the comprehensive credit requirements of the agriculture sector ,fisheries and animal husbandry by giving financial support to farmers.
• Participating institutions : Commercial banks, Regional Rural Banks, and state co-operative banks.
• Scheme entails short-term credit for crops and term loans.
• Coverage of personal accident insurance: 50,000(death and permanent disability), and Rs. 25,000 for other risks.
• Premium : Borne by both the bank and the borrower in a 2:1 ratio.
• Validity period : Five years, with an option to extend it up to three more years.
• KCC credit to the farmers is of two types,
• Cash Credit (for working capital)
• Term Credit (for capital expenditure such as the purchase of cattle, pump sets, land development, plantation, drip irrigations), etc.