According to recent reports, the outstanding non-performing assets (NPAs) in the Kisan Credit Card (KCC) segment have risen by 42% over the past four years, reaching ₹97,543 crore as of December 2024, up from ₹68,547 crore in March 2021.
This increase in NPAs indicates growing stress in the KCC portfolio, which is a crucial component of agricultural lending in India. The KCC scheme was introduced to provide farmers with timely credit for their cultivation and other needs. However, the rising NPAs suggest challenges in the repayment capacity of borrowers, possibly due to factors like crop failures, market fluctuations, or other economic pressures.
The Reserve Bank of India’s data also highlights a slowdown in personal loan growth, which decreased to 14.2% by January 24, 2025, from 18.2% a year earlier. This slowdown is attributed to reduced vehicle loans and credit card outstandings. Additionally, non-food bank credit increased by 12.5%, marking a three-month high, while credit to agriculture grew by 12.2%.
These trends underscore the need for a comprehensive review of lending practices and borrower support mechanisms in the agricultural sector to address the rising NPAs in the KCC segment.
