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Farm mechanization plays a vital role in enhancing agricultural productivity, labour efficiency, and profitability. However, small and marginal farmers in India face significant challenges in adopting mechanization due to limited financial resources and fragmented landholdings. To address these constraints, the Government of Karnataka established Custom Hiring Centres (CHCs) to provide access to modern farm machinery on a rental basis, thereby promoting inclusive mechanization. The present study was undertaken in Mandya district, a major rice-growing area of Karnataka, to assess the impact of CHCs on the economic performance and mechanization level of farmers. Five CHCs located at Basaralu, Athguru, Akkihebbala, Chinnakurli, and Arakere were selected, and data were collected from 150 paddy-growing farmers, comprising 75 beneficiaries and 75 non-beneficiaries, using a pre-tested interview schedule during the Kharif season of 2023–24. The data were analysed using descriptive statistical techniques, cost–benefit comparisons and gap analyses were used. Results revealed that all farmers (100%) had mechanized at least one major paddy operation, while 92% adopted mechanical transplanting. However, 46.67% still depended on manual harvesting due to machinery shortages. Among CHC beneficiaries, the cost of cultivation decreased by 5.56%, productivity increased by 9.61%, and cost of production declined by 15.78% compared with non-beneficiaries. The incremental cost-benefit ratio (ICBR) of 3.62 indicated strong economic viability of CHC services. Nevertheless, significant gaps were observed in the availability of critical equipment, such as paddy transplanters (75% shortage) and combine harvesters (100% shortage). The findings highlight that CHCs are effective in improving access to mechanization and enhancing farm income, but require strengthened operational capacity, digital booking systems, and adequate machinery inventory for sustained impact.