The problem
Crop loans in the cooperative sector follow intricate rules: multiple schemes, multiple lines of credit, different durations and different norms — all converging on a single farmer’s loan account. Primary Agricultural Credit Societies (PACS) run the frontline, District Central Cooperative Banks (DCCBs) run the banking technology, and PACS aren’t allowed to issue Kisan Credit Cards (KCCs) themselves.
What the Kisan Loan System does
KLS processes crop loans end to end — credit-limit applications, drawals and repayments — capturing the parameters that drive them: members, schemes, seasons, crops, crop insurance, scales of finance, due dates and interest rates.
- A compliant bridge between DCCB and PACS, connecting the bank’s technology network with the PACS’s frontline network.
- One account for all loans — concurrent loans with different durations, rates, repayment schedules and insurance premiums, each line of credit linked to a single Savings-cum-KCC account.
- Real-time validation — an interface to the ATM switch validates loan withdrawals and sweeps approved amounts into the Savings account.
- No interchange charges — because operations run through the Savings account, neither the bank nor the farmer pays credit interchange fees.
- Self-service repayment through Micro ATMs, POS terminals and cash-deposit ATMs, where branches are scarce.
- Parameterized loan products, so banks can set up localized products with their own interest categories.