Why should I draw small amounts and repay often on my KCC?

Your friend is right. A KCC works like a running account or overdraft, so interest is charged only on the amount you have drawn and only for the days it stays out. If you pull the full limit on day one and leave it in your pocket, you pay interest on all of it the whole time, even the part you did not need yet. Instead, draw money in stages as the crop needs it, for seed, then fertiliser, then spray, and push any spare cash back into the account whenever you have it. Putting money back lowers the outstanding and therefore the interest, and it builds the clean repayment record that keeps your prompt repayment incentive and the cheap effective rate. Many smart farmers clear the whole outstanding once after each harvest and then draw again for the next season. So yes, draw small, repay often, and keep within the cheap limit band. Confirm with your branch that your account is operated as a running account so this works for you.