BPSC 71st CCE Prelims Q43: Before the launch of Kisan Rin Portal (KRP), farmers used

Q: What is the answer to BPSC 71st CCE Prelims Q43?

B. Correct — B, Reserve Bank of India and NABARD. The Press Information Bureau's own account of the Kisan Rin Portal settles it in a sentence: previously, banks had to submit claims for Interest Subvention and Prompt Repayment Incentive manually to the Reserve Bank of India and NABARD, which caused significant delays and inefficiencies. The Commission gave the same reason when it disposed of objections to this paper on 31 October 2025, recording that before the portal the route ran through RBI for the nationalised banks and through NABARD for Regional Rural Banks and cooperative banks. That two-way split is the entire answer, and it is not arbitrary. RBI is the regulator of and settlement point for scheduled commercial banks, so their subvention claims were reimbursed through it. NABARD is the apex refinancing and supervisory institution for the rural cooperative credit structure and for RRBs, so claims arising in that channel terminated at NABARD. Note also what the stem's own wording implies: the claims were being filed by lending institutions on farmers' behalf, not walked in by farmers themselves. What was being claimed is the Modified Interest Subvention Scheme. A Kisan Credit Card short-term crop loan up to Rs 3 lakh is priced at 7 per cent with the government meeting the gap, and a farmer who repays on time earns a further 3 per cent Prompt Repayment Incentive, taking the effective rate down to 4 per cent. Someone has to reimburse the lender for that gap, and until September 2023 that reimbursement was a paper claim. The Kisan Rin Portal, launched by the Department of Agriculture and Farmers Welfare in September 2023, digitised submission, verification and settlement end to end: by 31 December 2024 it had processed claims worth Rs 1,08,336.78 crore and mapped about 5.9 crore MISS-KCC beneficiary farmers.

BPSC 71st CCE Prelims General Studies · Question 43 of 150

Verified against the official question booklet. Answer as per the official BPSC answer key.

Question order, option order and answers follow the official BPSC Booklet Series E (booklet GA-502), paper code 11/GA/CC/PT-2025.

Before the launch of Kisan Rin Portal (KRP), farmers used to submit manual claims under the Interest Subvention and Prompt Repayment Incentive schemes to which of the following institution/s?

(a)Ministry of Agriculture and Farmers Welfare and NABARD
(b)Reserve Bank of India and NABARD
(c)National Payments Corporation of India and Reserve Bank of India
(d)More than one of the above

Answer

Why

Correct — B, Reserve Bank of India and NABARD. The Press Information Bureau's own account of the Kisan Rin Portal settles it in a sentence: previously, banks had to submit claims for Interest Subvention and Prompt Repayment Incentive manually to the Reserve Bank of India and NABARD, which caused significant delays and inefficiencies. The Commission gave the same reason when it disposed of objections to this paper on 31 October 2025, recording that before the portal the route ran through RBI for the nationalised banks and through NABARD for Regional Rural Banks and cooperative banks. That two-way split is the entire answer, and it is not arbitrary. RBI is the regulator of and settlement point for scheduled commercial banks, so their subvention claims were reimbursed through it. NABARD is the apex refinancing and supervisory institution for the rural cooperative credit structure and for RRBs, so claims arising in that channel terminated at NABARD. Note also what the stem's own wording implies: the claims were being filed by lending institutions on farmers' behalf, not walked in by farmers themselves. What was being claimed is the Modified Interest Subvention Scheme. A Kisan Credit Card short-term crop loan up to Rs 3 lakh is priced at 7 per cent with the government meeting the gap, and a farmer who repays on time earns a further 3 per cent Prompt Repayment Incentive, taking the effective rate down to 4 per cent. Someone has to reimburse the lender for that gap, and until September 2023 that reimbursement was a paper claim. The Kisan Rin Portal, launched by the Department of Agriculture and Farmers Welfare in September 2023, digitised submission, verification and settlement end to end: by 31 December 2024 it had processed claims worth Rs 1,08,336.78 crore and mapped about 5.9 crore MISS-KCC beneficiary farmers.

Why the others are wrong

(a)Ministry of Agriculture and Farmers Welfare and NABARD — Half right, which is exactly what makes it the trap. NABARD does belong in the answer, and the Department of Agriculture and Farmers Welfare genuinely owns the Modified Interest Subvention Scheme and built the Kisan Rin Portal in September 2023. But the ministry designs the scheme and funds it from the Budget; it was never the counter at which lending institutions filed their manual claims. Commercial banks filed with their regulator, the Reserve Bank of India. Substituting the ministry for RBI breaks the pair, and a paired option is only correct when both halves are.
(c)National Payments Corporation of India and Reserve Bank of India — This one gets RBI right and the partner wrong. NPCI is India's umbrella retail-payments organisation — the operator behind UPI, RuPay, NACH and AePS — and candidates reach for it because 'digitised claim settlement' sounds like payments plumbing. But NPCI runs payment systems between banks; it does not administer an agricultural interest-subsidy scheme, does not receive subvention claims, and has no supervisory relationship with the Regional Rural Banks and cooperative banks whose claims NABARD handled.
(d)More than one of the above — Options (a) and (c) each contain one correct institution, which is what tempts a candidate into treating (d) as the safe umbrella. But (d) asserts that more than one of the three listed pairs is correct as a pair, and only (b) names both bodies that actually received the claims. One right half does not make a right option, and at −1/3 for a wrong answer this hedge costs a third of a mark rather than saving one.

Concept

Institutional agricultural credit in India runs down three separate channels, and knowing which body sits at the head of each unlocks a whole class of questions. Scheduled commercial banks lend directly and answer to the Reserve Bank of India. Regional Rural Banks, set up from 1975, and the cooperative structure — State Cooperative Banks above District Central Cooperative Banks above Primary Agricultural Credit Societies — are refinanced and supervised by NABARD, established in 1982. The instrument at the retail end is the Kisan Credit Card, introduced in 1998, extended in 2019 to animal husbandry, dairying and fisheries, and offering collateral-free loans up to Rs 1.60 lakh. The subsidy mechanism is the piece candidates skip. Government does not lend cheap money itself; it lets banks lend below market rate and then reimburses them the difference, which is what 'interest subvention' means. A separate Prompt Repayment Incentive rewards farmers who repay on schedule. Both are therefore claims that a lender files after the fact, and a claims process needs a receiving institution for each channel — RBI for the commercial banks it regulates, NABARD for the rural institutions it refinances. The scale explains why the paperwork became unmanageable: institutional credit to agriculture rose from Rs 8.5 lakh crore in 2014-15 to Rs 25.48 lakh crore in 2023-24, and India had 7.75 crore operational KCC accounts carrying Rs 9.81 lakh crore of outstanding loans as of March 2024.

Work this question by asking what kind of body a manual claim can actually be filed with. A claim for money is settled by an institution that keeps accounts with banks and reimburses them — not by a policy ministry that writes the scheme, and not by a payments company that switches transactions between banks. That single test disposes of the ministry in option (a) and of NPCI in option (c) without knowing anything specific about the portal. What remains is to name the two settlement points, one for each credit channel, and the discriminating fact is NABARD's real function: it does not lend to farmers directly, it refinances and supervises the RRB and cooperative structure. That is precisely why claims originating in that structure end at NABARD while commercial banks' claims end at RBI. The trap is option (a), and it is well built, because NABARD's presence makes the pair feel familiar and the Department of Agriculture and Farmers Welfare really is the scheme's owner and the portal's builder. The lesson generalises: on a paired option, verify both halves and reject on the weaker one. There is a second tell in the stem worth training on. The word 'manual' is doing work — it tells you the answer is a pre-digital settlement counter, which is an operational role, and it points you away from the ministry that merely funds the scheme.

Key facts

PIB's account of the Kisan Rin Portal states that banks previously submitted Interest Subvention and Prompt Repayment Incentive claims manually to the Reserve Bank of India and NABARD; BPSC's own remark of 31 October 2025 adds the split — RBI for nationalised banks, NABARD for Regional Rural Banks and cooperative banks.
The Kisan Rin Portal was launched in September 2023 by the Department of Agriculture and Farmers Welfare; by 31 December 2024 it had processed claims worth Rs 1,08,336.78 crore and mapped about 5.9 crore MISS-KCC beneficiary farmers.
Under the Modified Interest Subvention Scheme a KCC short-term crop loan up to Rs 3 lakh carries 7 per cent interest, with a further 3 per cent Prompt Repayment Incentive for timely repayment bringing the effective rate to 4 per cent; the Union Budget 2025-26 raised the MISS loan limit from Rs 3 lakh to Rs 5 lakh.
As of March 2024 India had 7.75 crore operational Kisan Credit Card accounts with Rs 9.81 lakh crore outstanding; after the 2019 extension of KCC to allied activities, 44.40 lakh cards had been issued for animal husbandry and 1.24 lakh for fisheries, with collateral-free lending up to Rs 1.60 lakh.
Institutional credit to agriculture rose from Rs 8.5 lakh crore in 2014-15 to Rs 25.48 lakh crore in 2023-24, and short-term agricultural credit from Rs 6.4 lakh crore to Rs 15.07 lakh crore; interest subsidy released on KCC loans grew from Rs 6,000 crore to Rs 14,252 crore a year, Rs 1.44 lakh crore over the decade, while small and marginal farmers' share of agricultural loan access rose from 57 per cent to 76 per cent.

The stone-faced central office building of the Reserve Bank of India on Shahid Bhagat Singh Marg in Fort, Mumbai, its tall pilastered entrance bay carrying the RBI emblem above the doorway — Before the Kisan Rin Portal digitised the process in September 2023, banks filed their Interest Subvention and Prompt Repayment Incentive claims by hand with two institutions — the Reserve Bank of India, headquartered in this Mumbai building, for the commercial banks it regulates, and NABARD for Regional Rural Banks and cooperative banks. The answer to this question is that pair.Image: Anurag Vijay 03 · Wikimedia Commons (CC BY-SA 4.0)

Study next

The Modified Interest Subvention Scheme in detail — the 7 per cent base rate, the 3 per cent Prompt Repayment Incentive, the Rs 3 lakh ceiling raised to Rs 5 lakh in the Union Budget 2025-26, and post-harvest loans against Negotiable Warehouse ReceiptsNABARD's mandate — established in 1982, refinance and supervision of RRBs and the cooperative credit structure, the SHG-Bank Linkage Programme from 1992, and why it does not lend directly to individual farmersThe three-tier short-term cooperative credit structure — State Cooperative Banks, District Central Cooperative Banks and Primary Agricultural Credit Societies — and the computerisation of PACSPriority sector lending and the Kisan Credit Card as an instrument: the 1998 origin on the R. V. Gupta Committee's recommendation, the 2019 extension to animal husbandry, dairying and fisheries, and collateral-free lending up to Rs 1.60 lakhOther agriculture-credit digital platforms BPSC may pick up next — the Kisan Rin Portal itself, Agri Stack and the Farmer Registry, and PM-KISAN's direct benefit transfer architecture

Common traps

Accepting a paired option because one half is familiar — NABARD is right in option (a), but the Ministry of Agriculture and Farmers Welfare is not, and a pair is only correct when both halves are
Mistaking NPCI for a scheme administrator; it operates retail payment systems such as UPI, RuPay and AePS and receives no subvention claims
Confusing who owns the scheme with who settled the claims — the Department of Agriculture and Farmers Welfare runs MISS and built the portal, while RBI and NABARD were the receiving institutions

BPSC asks the mechanism — who received the claim before the portal existed — a process detail that lives in one line of a PIB explainer, and it pairs two institutions inside each option so that half-knowledge scores nothing. UPSC almost never asks about a claims counter; it asks about the instrument and the channel, as in 2020 when it tested which purposes a KCC short-term limit may fund, and in 2013 when it tested which rural lenders extend direct credit as against refinance. Learn the credit architecture and BPSC's process detail falls out of it.

Related PYQs

UPSC_2013_GS1_Q1002013Open & attempt →

Which of the following grants/grant direct credit assistance to rural households? 1. Regional Rural Banks 2. National Bank for Agriculture and Rural Development 3. Land Development Banks Select the correct answer using the codes given below:

(a) 1 and 2 only
(b) 2 only
(c) 1 and 3 only
(d) 1, 2 and 3

Answer(c) 1 and 3 only

The fact that decides the BPSC question, tested head-on by UPSC. NABARD is an apex refinancing and supervisory body rather than a direct lender to rural households — which is precisely why the interest-subvention claims of Regional Rural Banks and cooperative banks terminated at NABARD while commercial banks' claims terminated at the Reserve Bank of India.

UPSC_2020_GS1_Q662020Open & attempt →

Under the ‘Kisan Credit Card’ scheme, for which of the following purposes can farmers avail of short-term credit support? 1. Working capital for maintenance of farm assets 2. Purchase of farm machinery, tractors and mini-tools 3. Consumption requirements of farm households 4. Post-harvest expenses 5. Construction of a house for the family and setting up of cold storage facilities in the village Select the correct answer using the code given below:

(a) 1, 2 and 5 only
(b) 1, 3 and 4 only
(c) 2, 3, 4 and 5 only
(d) 1, 2, 3, 4 and 5

Answer(b) 1, 3 and 4 only

The same instrument from the other end. This UPSC item tests what the Kisan Credit Card short-term limit may be spent on; the BPSC item tests who reimbursed the bank for lending it below market rate. Both rest on knowing that MISS applies to the KCC short-term crop-loan limit and not to long-term investment credit.

Practice

practice — not a real PYQ
The Kisan Rin Portal (KRP), which digitised the submission and settlement of Interest Subvention and Prompt Repayment Incentive claims, was launched in
- (a)September 2019
- (b)September 2021
- (c)September 2023
- (d)September 2025
Answer(c) September 2023 — the Department of Agriculture and Farmers Welfare launched the portal in September 2023, and by 31 December 2024 it had processed claims worth Rs 1,08,336.78 crore and mapped about 5.9 crore MISS-KCC farmers.
practice — not a real PYQ
Under the Modified Interest Subvention Scheme, a farmer who repays a Kisan Credit Card short-term crop loan promptly bears an effective interest rate of
- (a)2 per cent
- (b)3 per cent
- (c)4 per cent
- (d)7 per cent
Answer(c) 4 per cent — the loan is priced at 7 per cent and prompt repayment earns a further 3 per cent Prompt Repayment Incentive, so 7 minus 3 leaves an effective 4 per cent. The 7 per cent figure is the rate before the incentive, not after it.