The Narendra Modi-led government has come up with a new credit plan for rural women to create more enterprises and jobs in villages, according to officials.
The scheme on enterprise financing, for the first time, will give individual members of a self-help group (SHG) access to bank loans. Currently, SHG members can avail bank loans only as groups.
The credit can be availed without any collateral and without any previous experience of entrepreneurship, according to a presentation on the scheme accessed by HT. “The government will give an interest subvention to individual borrowers on loan up to ₹1.5 lakh for three years on prompt repayment,” the presentation mentioned. The soft-launch of the scheme took place last week.
Union rural development secretary Nagendra Nath Sinha said: “The enterprise financing scheme will create more business opportunities for women. This, in turn, will create more employment in rural belts as the entrepreneurs would need workforce to run their business.”
“It also helps in creating additional sources of income for women and diversify income to boost the rural economy,” Sinha added.
According to the guidelines of the scheme, reviewed by HT, any SHG member who has serviced “two cycles of loans or vintage of 24 months” can be eligible to get loans under the scheme. If the women entrepreneur has no prior experience, she can avail a loan of up to ₹50,000. But for loans up to ₹2 lakh, two years of experience in the same business would be required.
While individual members of an SHG can benefit from this scheme, proprietorship firms can also access credit. A government official said that women between 21 and 60 years of age are eligible for this new credit scheme.
Another senior official added that the credit scheme has been designed keeping in mind the post-Covid financial requirements in the rural economy. “The MGNREGS and the Union government’s Garib Kalyan Yojana, which provides free food grains, have been extremely helpful for millions of rural poor in the difficult time. But it’s about time that rural households can diversify their income,” the official involved in the enterprise finance scheme said, asking not to be named.
The funds can be used for various schemes under the Ajeevika National Rural Livelihood Mission (NRLM). The flagship scheme aims at creating efficient and effective institutional platforms for the rural poor, enabling them to increase household income through sustainable livelihood enhancements and improved access to financial services. So far, over 86.1 million households have been mobilised through the NRLM.
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