CHANDIGARH, JUNE 3 — Chief Minister Bhagwant Singh Mann announced a comprehensive restructuring of the 26-year-old Kisan Credit Card framework to align agricultural loans with actual cultivation expenses and eliminate dependence on informal lending networks.
The updated policy alters credit thresholds across multiple crop sectors, extending borrowing limits for specific horticulture crops up to 1.57 lakh rupees per acre from a previous flat cap of 32,000 rupees. The administrative changes introduce a six-year sanction window, reduced interest structures, and direct integration with modern financial platforms including automated teller machines and Unified Payments Interface systems.
State officials stated that the modernization effort is expected to provide enhanced financial flexibility to more than 13 lakh cultivators across Punjab, moving away from manual paper documentation.
“This is not merely a policy change but a historic initiative aimed at the economic liberation of Punjab’s farmers,” Mann declared during a press conference. “We have removed red tape, ensured that more money reaches farmers directly in their bank accounts, and made it easier for Primary Agriculture Cooperative Societies and District Central Cooperative Banks to serve them efficiently.”
The revision alters the baseline credit scale for staple crops, moving wheat allowances from 24,380 rupees to 30,000 rupees per acre, and raising paddy limits from 25,440 rupees to 39,000 rupees per acre.
Under the new terms, Punjab becomes the first state to incorporate environmental management parameters directly into the credit structure. The revised paddy credit allocation contains a specific 2,000 rupees per acre provision dedicated exclusively to stubble management and crop residue processing.
The policy also addresses long-standing gaps in cash crop funding. Borrowing limits for planted sugarcane have risen to 1 lakh rupees per acre from 44,000 rupees, while ratoon crops receive a new dedicated allocation of 65,000 rupees per acre.
“Earlier, farmers often had to depend on informal lenders and NBFCs charging exorbitant interest rates because institutional credit did not meet their actual needs,” Mann noted, affirming that the strategic objective centers on integrating producers into a regulated cooperative network.
Diversification efforts receive financial backing through the inclusion of non-traditional crops within the institutional credit net. Cultivators of agro-forestry options like poplar and bamboo, alongside specialty items such as lemongrass, dragon fruit, and hybrid tomatoes, can now access standardized loans.
Specific allocations include 1,57,372 rupees per acre for garlic and 80,981 rupees per acre for hybrid tomatoes. Allied fields also see adjustments, with white shrimp farming credit caps climbing to 5.5 lakh rupees per hectare.
To minimize intermediary interference, the primary credit component will route directly into savings accounts, with additional provisions allowing credit utilization for drone hiring and custom cultivation services.
“We are moving away from slow manual cheque-based processes,” Mann stated, adding that producers utilizing online channels for loan clearance would receive distinct banking incentives.
