Utilization Pattern of KCC Loan and Income Generation among Small Scale Farmers in North Eastern Region of India: An Empirical Study in Manipur

Abstract

Access to timely and affordable institutional credit is essential for enabling smallholder farmers to meet production costs, adopt improved agricultural practices, and strengthen farm-based livelihoods. The Kisan Credit Card scheme was introduced to provide flexible credit support for agricultural and allied activities; however, evidence on its utilisation and income implications in Manipur remains limited. The study examined the utilisation pattern of Kisan Credit Card (KCC) loans and income generation among smallholder farmers in the valley areas of Manipur, India. Four districts were selected purposively, and primary data were collected from 400 respondents, comprising 200 KCC beneficiaries and 200 non-beneficiaries. Descriptive statistics, the Gini concentration ratio, the Lorenz curve, and the Garrett ranking technique were used for analysis. Beneficiary farmers recorded an average rice yield of 5,085.70 kg per hectare and gross income of ₹1,37,314 per hectare, compared with 3,993.26 kg per hectare and ₹1,07,818 per hectare among non-beneficiaries. Average household earnings from winter and summer crops were ₹26,124 for beneficiaries and ₹18,605 for non-beneficiaries, while earnings from livestock and fishery were ₹1,01,163 and ₹86,763, respectively. The Gini concentration ratio was 0.65 for beneficiaries and 0.86 for non-beneficiaries, indicating comparatively more uniform income distribution among beneficiaries. The largest average KCC loan amount was received for piggery enterprises, followed by fishery and rice cultivation. For rice production, the greatest expenditure was incurred on land preparation, harvesting and threshing, weeding, and fertiliser purchases. Inadequate loan amounts, lack of insurance coverage, distant bank locations, and delayed disbursement were major constraints among beneficiaries. Lack of awareness and limited knowledge of the banking system were prominent barriers among non-beneficiaries.