What changed
RBI directed banks to introduce a General Credit Card (GCC) scheme for rural and semi-urban areas, akin to the Kisan Credit Card but for general purposes. Unlike standard credit cards, GCC does not require POS or ATM infrastructure and can be issued as a passbook. The scheme mandates no security or end-use restrictions, with a maximum limit of Rs.25,000 per individual.
What it means for you
Banks can now offer unsecured, revolving credit to rural/semi-urban customers without collateral or purpose checks, using cash flow assessment. This expands credit access in areas with limited digital infrastructure. Fifty percent of GCC outstanding up to Rs.25,000 qualifies as indirect agricultural finance under priority sector lending, aiding compliance. Banks must target women borrowers preferentially and can source customers through local institutions like post offices and schools.
What you must do
- Implement GCC scheme at branches in rural/semi-urban areas, issuing credit as passbook or card.
- Set credit limits up to Rs.25,000 based on household income and cash flow, without security or end-use conditions.
- Charge interest rates as considered appropriate and reasonable, with periodic limit reviews.
- Give preferential treatment to women borrowers under the scheme.
- Partner with local post offices, schools, primary health centers, local government functionaries, farmers' associations/clubs, community-based agencies, and civil society organisations for borrower sourcing.
Who it affects
All Scheduled Commercial Banks, Regional Rural Banks (RRBs), Rural and semi-urban bank customers, Women borrowers in rural areas
What is the maximum credit limit under the GCC scheme?
The total credit facility under GCC for an individual should not exceed Rs.25,000.
Does GCC require collateral or specify end-use of funds?
No, the scheme does not insist on security or any purpose or end-use of the credit.
How does GCC affect priority sector lending for banks?
Fifty percent of credit outstanding under GCC up to Rs.25,000 is eligible for treatment as indirect agricultural financing.