No longer current — withdrawn, no replacement on file yet
Source: Reserve Bank of India · RBI/2011-12/219 · issued 13 Oct 2011 · ~1 min read
Quick answerRBI clarifies that all credit extended under the Kisan Credit Card (KCC) scheme qualifies as direct finance to agriculture under priority sector lending, helping banks meet their agricultural lending targets.
What changed
Previously, working capital and term loans for financing production and investment requirements for agriculture and allied activities were treated as direct finance. This circular explicitly confirms that credit under the Kisan Credit Card, being primarily for agricultural purposes, also qualifies as direct finance for agriculture under priority sector lending.
What it means for you
Banks can now classify all KCC loans as direct agricultural advances, which helps them meet priority sector lending targets for agriculture. This simplifies reporting and encourages more KCC issuance, as it directly supports priority sector compliance.
Historical instruction — do not use for current compliance. This is what was required at the time; it no longer reflects current RBI requirements. If no replacement rule is linked above, that only means none is recorded on our register yet — it does not prove no later applicable rule exists. Confirm on the official RBI source below.
What banks were required to do at the time
Reclassify existing KCC loans as direct finance to agriculture in priority sector reporting.
Ensure new KCC disbursements are tagged correctly under direct agricultural advances.
Update internal systems and reporting templates to reflect this classification change.
Train branch staff on the revised classification to avoid misreporting.
Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).
Does this circular apply to Regional Rural Banks?
No, the circular explicitly excludes Regional Rural Banks from its scope.
What types of KCC loans are covered?
All credit under the Kisan Credit Card scheme, as it is primarily for agricultural purposes, is treated as direct finance to agriculture.
📜 Read the original circular — full text as issued by RBI
RBI/2011-12/219
RPCD.CO.Plan.BC. 22 /04.09.01/2011-12
October 13, 2011
The Chairman/Managing Director/
Chief Executive Officer
[All Scheduled Commercial Banks (excluding Regional Rural Banks)]
Dear Sir/ Madam,
Inclusion of Credit under KCC under direct financing for Agriculture
Please refer to para 1.1.3 of our circular RPCD.CO.Plan.BC.No.10/04.09.01/2011-12 dated July 1, 2011 on lending to priority sector in terms of which working capital and term loans for financing production and investment requirements for agriculture and allied activities are treated as direct finance to agriculture under priority sector.
2. As credit under the Kisan Credit Card is primarily for agricultural purposes, it is clarified that such credit would be treated as direct finance for agriculture under priority sector lending.
Yours faithfully,
(Deepali Pant Joshi )
Chief General Manager-in-Charge
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2011-12/219 · issued 13 Oct 2011. The plain-English explanation above is BankPulse’s own independent summary.
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BankPulse Compliance Evidence Pack — generated 03 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly). Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=6760&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
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