GOVERNMENT SPONSERED LOAN SCHEMES

(DAY- NRLM, NULM, SRMS, DRI)

Prepared by, Abinash Kr. Mandilwar

Chief Manager & Faculty Member, Staff Training College, Bhopal

Deendayal Antyodaya Yojana - National Rural Livelihoods Mission

( DAY-NRLM)HOBC No. 110/86 Dt. 06/08/2016 (Master Circular)

Circular letter No. 2016-17/78 Dt. 29/09/2016

DAY- NRLMThe Ministry of Rural Development,

Government of India launched a new programme known as NRLM now renamed as Deendayal Antyodaya Yojana – National Rural Livelihoods Mission (DAY-NRLM), by restructuring and replakhing the Swarnjayanti Gram Swarozgar Yojana (SGSY) scheme with effect from April 01, 2013.

NRLM, renamed as DAY-NRLM w.e.f. March 29, 2016.

OBJECTIVEPoverty reduction by building strong institutions

of the poor (particularly women) and enabling these institutions to repeatedly access, a range of financial services (particularly bank loans) till they attain sustainable livelihood).

The blocks and districts in which all the components of DAY-NRLM will be implemented, either through the SRLMs (State Rural Livelihood Mission) or partner institutions or NGOs, will be the intensive blocks and districts, whereas remaining will be non-intensive blocks and districts.

FEATURE OF WOMEN SHGAffinity based women SHGs under DAY-NRLM consist of 10-15

persons. In case of special SHGs i.e. groups in the difficult areas, groups

with disabled persons, and groups formed in remote tribal areas, this number may be a minimum of 5 persons.

Only for groups to be formed with Persons with disabilities, and other special categories like elders, transgender, DAY-NRLM will have both men and women in the self-help groups.

SHG is an informal group. Registration under Societies Act, State Cooperative Act or as a partnership is not mandatory.

But federations of SHGs formed at Village level, cluster levels are to be registered under appropriate acts prevailing in their states.

FINANCIAL ASSISTANCE TO SHGA. Revolving Fund (RF): It is to strengthen their

institutional and financial management capacity and build a good credit history within the group. RF is available if ;

(a) SHG is in existence for a minimum period of 3-6 months.

(b) SHG follows ‘Panchsutra’ i.e. Regular meetings; Regular savings; Regular inter-loaning; Timely repayment; and Up-to-date books of accounts;

(c) SHGs did not receive any Revolving Fund earlier.RF is available as corpus with a minimum of Rs. 10,000/- and maximum of Rs. 15,000/- per SHG.

COMMUNITY INVESTMENT SUPPORT FUND (CIF)

CIF will be provided to the SHGs in the intensive blocks, routed through the Village level/ Cluster level Federations, to be maintained in perpetuity by the Federations.

The CIF will be used, by the Federations, to advance loans to the SHGs and/or to undertake the common/collective socio-economic activities.

Capital Subsidy: No Capital Subsidy will be sanctioned to any SHG from the date of implementation of DAY-NRLM.

INTEREST SUBVENTION1) It is to be provided to cover the difference between lending rate

and 7% (Max 5.5%) on all loans from Banks/FIs to Women SHGs;

2) For a maximum of Rs. 3.00 lakhs per SHG in two ways:-a. In 250 identified districts, banks will lend to all the women

SHGs @ 7% up to an aggregated loan amount of Rs. 3.00 lakhs. The SHGs will get additional interest subvention of 3% on prompt repayment, reducing the effective rate of interest to 4%;

b. In the remaining districts, DAY- NRLM compliant women SHGs will be registered with State level Rural Livelihood Missions (SRLMs). These are eligible for subvention to the extent of difference between the lending rates and 7% for the loan amount up to Rs. 3.00 lakhs. This is to be operationalized by SRLMs.

ROLE OF BANKSBanks have to open Savings Bank accounts for all

women SHGs, SHGs with members of Disability and the Federations of the SHGs. The KYC norms specified by RBI are applicable for identification of the customers.

Eligibility Criteria: i. SHG should be in active existence for minimum 6

months;ii. Practicing ‘Panchasutras’iii. Existing defunct SHGs are eligible if they are

revived and continue to be active for a minimum period of 3 months.

LOAN AMOUNT Emphasis is laid on the multiple doses of assistance under DAY-

NRLM. This would mean assisting an SHG over a period of time, through repeat doses of credit, to enable them to access higher amounts of credit for taking up sustainable livelihoods and improve on the quality of life.

The amount of various doses of credit should be as follows: 1st dose: 4-8 times of proposed corpus during the year or Rs.

50,000/- whichever is higher; 2nd dose: 5-10 times of existing corpus and proposed saving

during the next 12 months or Rs. 1 lakh, whichever is higher. 3rd dose: Minimum Rs. 2 lakhs, based on Micro credit Plan

prepared by SHGs & appraised by Federations/Support Agency and the previous credit history.

4th dose onwards: Loan amount can be between Rs. 5-10 lakhs or higher in subsequent doses, based on the Micro Credit Plans of the SHGs and their members.

OTHER FEATURES OF DAY-NRLMPurpose: Loans may be used for meeting social needs, high

cost debt swapping and taking up sustainable livelihoods by the individual members within the SHGs. It can be to finance any viable common activity started by the SHGs.

Type of Loan: Term loan and/or cash credit. Additional loan can be sanctioned even if the previous loan is outstanding.

Repayment Schedule: 1st dose- 6-12 installments;2nd dose- 12-24 months;3rd Dose- Mthly/Qly/H.Yly, between 2 to 5 years4th dose:- Mthly/Qly/H.Yly, between 3 to 6 years.

OTHER FEATURES OF DAY-NRLMSecurity & Margin:

Loan up to Rs. 10 lakhs- NIL;No lien should be marked against Savings bank account of

SHGs;No deposits should be insisted while sanctioning loan.

Dealing with Defaulters: Non-willful defaulters should not be debarred from

receiving the loan;Willful defaulters should not be financed (Willful

defaulters members of a group can be allowed to benefit from the thrift and credit activities of the group including the corpus built up with the assistance of Revolving Fund).

National UrbanLivelihoods Mission

(NULM)(HOBC-108/226 dated 25.03.2015)

NATIONAL URBAN LIVELIHOODS MISSION (NULM)Launching/Implementing Agency: GOI, Ministry of Housing

and Urban Poverty Alleviation has restructured the existing Swarna Jayanti Shahari Rozgar Yojana (SJSRY) and launched the NULM w.e.f. 24.09.2013.

Scheme is operative in all districts headquarters irrespective is population and all cities with population of 1 lakh or more and that SJSRY was to remain operational till March 31, 2014.

The Self Employment Programme (SEP) component of NULM will focus on providing financial assistance through a provision of interest subsidy on loans to support establishment of individuals and Group Enterprises and SHGs of urban poor.

TARGET AND FEATURES OF NULMMinimum percentage of women beneficiaries under Self

Employment Programme (SEP) shall not be less than 30%, SC/ST must be benefited at least to the extent of the

proportion of their strength in the city/town population of poor,

3% for PWD,15% for minority community. No minimum educational qualifications and training

requirement. If project require skills for running the proposed micro-

enterprise, training under EST& individual and group entrepreneurs.

In addition to skill training of the beneficiaries, the ULB will also arrange to conduct EDP Programme for 3-7 days.

INTEREST SUBVENTIONa. The difference between 7% p.a. and the

prevailing It is to be provided to banks under NULM.

b. After disbursement of loan to the beneficiaries, the concerned branch of the bank will send details of disbursed loan cases to ULB along with details of interest subsidy amount.

c. Claim of interest subvention- quarterly basis.

NULM LOAN TO INDIVIDUALEligibility: An urban poor individual for setting up a micro-

enterprises for self employment.

Age: beneficiary should have attained 18 years age.

Project Cost: The maximum unit project cost for individual micro-enterprises cases is Rs. 2.00 lakhs.

Collateral on Bank Loan: No collateral required. Banks are mandated not to accept collateral security in the cases of loans up to Rs. 10 lakhs extended to units in the MSE Sector. Therefore only the assets created would be hypothecated/mortgaged/pledged to banks for advancing loans.

Repayment: 5 to 7 years after initial moratorium of 6-18 months as per norms of the banks.

NULM LOAN TO SHGEligibility: The group enterprise should have

minimum 5 members with a minimum of 70% members from urban poor families. The application/intent to set up a group enterprise by beneficiaries/group members should preferably be referred by the community structures viz. SHG/ALF formed under SJSRY/NULM.

Age: All members of the group enterprise should have attained an age of 18 years at the time of applying for bank loan.

Project Cost: The maximum unit Project Cost for a group enterprise is Rs. 10 lakhs.

NULM LOAN TO SHGLoan: Project cost less the beneficiary

contribution (as specified by bank) would be made available as loan amount to the group enterprise by the bank.

Collateral on Bank Loan: No collateral guarantee required. Only assets created would be hypothecated/ mortgaged/ pledged to banks for advancing loans. The banks may approach CGTMSE guarantee.

Repayment: 5 to 7 years after initial moratorium of 6-18 months as decided by banks.

01/05/2023

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Chief Executive Officer/Municipal Commissioner, Urban Local Body

Chairman

Lead District Manager MemberCity Project Officer Member

ConvenerRepresentative from DIC MemberSr. Br. Manager (Max.2) of banks MemberRepresentative (2) of Area Level Federation/Civil Level Federation

Member

NULM_ TASK FORCE

SELF EMPLOYMENT SCHEME FOR REHABILITATION OF MANUAL SCAVENGERS

(SRMS)(HOBC No. 107/200 Dt. 08/02/2014)

DEFINITION OF MANUAL SCAVENGER“manual scavenger” means a person engaged or employed , at the commencement of this Act or at any time thereafter ,by an individual or a local authority or an agency or a contractor , for manually cleaning , carrying , disposing of,or otherwise handling in any manner , human excreta in an insanitary latrine or in an open drain or pit into which human excreta from the insanitary latrins is disposed of , or on a railway track or in such other spaces or premises , as the Central Government or a state Government may notify, before the excreta fully decomposes in such manner as may be prescribed , and the expression “manual scavenging “

SCHEME NORMS OF SRMSCash Assistance :The identified manual scavengers,

one from each family, would be eligible receiving Cash Assistance of Rs. 40,000/ immediately after identification. The beneficiary would be allowed to withdraw the amount in monthly installments of maximum of Rs.7000.

Maximum Project Cost : Rs.10 lakh for any activities under ISB and Rs.15 Iakh, in case of sanitation related projects i.e vaccum loader. suction machine with vehicle/ Garbage disposal vehicle , Pay & Use toilets etc.

SCHEME NORMS OF SRMSProvision of Capital subsidy based on project cost-Back-end

Capital Subsidy as given below:‑ Range of Project Cost (Rs.) Rate of Subsidy Upto 2,00,000/- 50% of project cost 2, 00,001 to 5,00,000/- Rs. 1 lakh + 33.3% of project cost 5,00,001 to 10,00,000/- Rs. 2 lakh + 25% of project cost10, 00,001 to 15, 00,000/- Rs. 3, 25,000/‑Rate of Interest to be charged from beneficiaries –

5% for PC up to Rs.25,000/-, (4% for women), 6% for PC above Rs.25,000/-Provision of interest subsidy, depending on the amount of

loan - No change - Gap between the actual rate of interest charged by bank and the rate of interest at which the loan is to be provided under the Scheme.

SCHEME NORMS OF SRMSMoratorium period for repayment of loan – Up to two

years.Maximum period of Training - 2 years.Stipend during training - Rs.3,000/- p.m.Repayment period including the moratorium period- For projects costing up to Rs. 5 Iakhs - 5 years. For projects costing more than Rs. 5 lakhs - 7 years.Penal Provisions for misuse of funds - Penal

provisions for misuse of funds by beneficiaries, provided under the Scheme. Entire amt. of subsidy with a penal intt. Of 6% will be recovered.

DIFFERENTIAL RATE OF INTEREST (DRI)

DRI SCHEMELaunched: The scheme is in operation since 1972 but has been

amended on 12.06.2007.Objective: To assist poorest of the poor and bring them above

the poverty line.Purpose of Loan: For productive activities, pursuing higher

education by indigent students, purchase of limbs, hearing aids, wheel chair for PWD.

Quantum of Loan: Maximum Rs. 15,000/- (additional Rs. 5000/- to PWD for artificial limbs/Brailee typewriter etc.);

Target: Minimum 40% to SC/ST beneficiaries; 2/3rd of the sanction should be routed through rural and

semi-urban branches.

DRI ELIGIBILITY NORMSIndividuals whose family income does not exceed Rs. 18000/-

p.a. in rural areas;Individuals whose family income does not exceed Rs. 24000/-

p.a. in semi-urban and urban areas.Individual whose land holding does not exceed 1 acre of

irrigated and 2.5 acres of un-irrigated land.No ceiling for:

SC/ST engaged in agriculture and allied activities. People engaged in Cottage and Rural industries; Persons with Disability pursuing gainful employment; Orphanages and women’s home; State owned corporations/cooperative societies including State

corporations for Supreme Court/ST’s/Cooperative Societies, Large sized

Adivasi Multipurpose Cooperative Societies for Tribal areas.

DRI SCHEMESecurity: Hypothecation of assets created out of bank

loan. No collateral.Subsidy: No subsidy, No margin.Rate of Interest: 4% p.a. simple.Repayment: Depending upon income generated.

Maximum 5 years including moratorium period up to 2 years depending upon the type of activity and income generation. For the beneficiaries under IAY, it may be extended up to 7 years.

Classification: Weaker Section Advance.