ਭਾਰਤ ਸਰਕਾਰ
Financial
Assistance
The focus is on mobilizing support for Self-Help Group (SHG) women and their federations. DAY-NRLM serves as a catalyst, facilitating financial assistance and providing a platform for these women to thrive. The following is a brief summary of the various support offered.
Revolving Fund (RF)
Savings is a small fund regularly contributed by the members, to lend to each other within the Self Help Group to meet the urgent household needs of members. As the age of the group increases this savings and accumulated interest develops into a corpus audit belongs to all the members. It creates a deep ownership of that fund. The Revolving Fund is a mechanism to accelerate the process of internal lending and increase the size of the corpus in the development of Self Help Groups. The main purpose of providing RF to SHG is to inculcate the habit of thrift and credit among the Self Help Group members and build their institutional capacities on the management of external funds. This is a permanent fund of the SHG. It resides with Self Help Group and is used for interloaning among the members of the Self Help Group. The average size of the Revolving Fund is Rs. 20,000/- to Rs. 30,000/- per Self Help Group.
Vulnerability Reduction Fund (VRF)
Vulnerability Reduction Fund (VRF) is routed to SHGs through federations (primary and secondary level) to support the livelihoods of members and initiate collective activities for the members. It is disbursed against Micro Credit Plans (MCPs) and Vulnerability Reduction plans (VRF) that are developed by the institutions. The institutions fund these MCPs through their resources or RF/CIF or bank loans.
Vulnerability Reduction Fund (VRF) is a fund given to the Village Organisations (VOs) as a Revolving Fund given by the Cluster Level Federations. The provision of fund is Rs. 1,50,000/- to each VO. Vulnerability Reduction Fund is a fund (corpus fund) given to address the vulnerabilities like food insecurity, health risk, sudden sickness/hospitalization, natural calamity, etc., faced by the household(s) or community.
Community Investment Fund (CIF)
The main purpose of providing a Community Investment Fund is to develop credit worthiness of the community institutions among the external formal financial institutions and create an opportunity for poor women to learn financial management skills. CIF can be used for socio-economic activities i.e. consumption needs, emergency needs, redemption of high-cost outstanding debt, livelihood enhancement and other priorities like education, health etc.
Community Investment Fund is extended to SHG federations which will be used to advance the loans to SHGs for undertaking socio-economic activities as per micro – credit /investment plan (MCP). An amount up to Rs. 2.50 lakh per SHG is given directly to the Cluster Level Federations (Village Organisations, in case CLF is not yet formed).
Viability Gap Fund (VGF)
Cluster Level Federations are given Community Investment Support Funds (start-up fund and community investment fund). CLFs are expected to earn income to meet their operational expenditures. There are circumstances where CLFs still need financial support to become financially viable. Some CLFs might not be able to generate surplus income to cover their operational expenditures. Thus, some of the operational costs of the CLFs are subsidized. However, to be financially sustainable, it has been envisaged that all such operational costs need to be borne by the CLFs. To support their operations until they achieve 100% Operational Self-Sufficiency (OSS), this funding gap is addressed through the Viability Gap Fund (VGF). The main purpose of the “Viability Gap Fund” is to fill the gap between operational income and expenditure of the federations for 3 years.
Bank Linkage
Financial inclusion is a key component to enable SHG members to become Lakhpati Didi, by making them the preferred clients of the banking system. To achieve this, engagement with financial regulators and commercial banks is undertaken, at strategic as well as operational levels through workshops, consultative forums, and capacity-building programs.
Financial Support to Women Producer Groups (PGs)
The Producer Groups are small-sized, unregistered entities with scope for significant business transactions. At the village level, PGs can aggregate the commodities and collectively sell them in the market, with better price negotiation and higher price realization. There is a provision of Rs. 2 Lakh per PG which includes working capital and infrastructure fund, for sustaining their business.
Financial Support to Women Producer Enterprises (PEs)
Lakhpati didi aims at promoting large-size Producer Enterprises (PEs) which yield benefits to the members such as economies of scale and increased bargaining power, improved market reach, access to finance, improved access to extension services, Professional management of the business etc. Efforts will also be made to promote the federation of these farmer-producer organizations/ PEs at the State Level.
Financial Support to
Women Farmer Producer
Organisations (FPOs)
In convergence with the Ministry of Agriculture and Farmers Welfare, Farmer Producer Organizations (FPOs) are being promoted by the Ministry Of Rural Development. Under the programme, Rs. 15 Lakh of equity grant support is provided to each of the FPOs in three years.
Community Enterprise Fund (CEF) for Individual and Group Enterprise Promotion
Start-up Village Entrepreneurship Programme (SVEP), One Stop Facility (OSF), Clusters and Incubators etc. are the main schemes which shall support the SHG members in taking up various livelihood options in a structured way to become Lakhpati Didis. The enterprises formed by SHG members have the potential to grow and expand.
Start-Up Village Entrepreneurship Programme (SVEP)
Aims to stimulate economic growth and reduce poverty and unemployment in the villages by helping start and support rural enterprises of SHG women. A budget of Rs. 6.5 crore has been earmarked per block for this. Block Resource Centers (BRCs) are created in each of the intervention blocks. Further Community Resource Persons for Enterprise Promotion (CRP-EP) are placed in Blocks to assist SHG women entrepreneurs to access finance from Banks, arrange seed capital for the business and handhold them in growing their enterprises.
Aajeevika Grameen Express Yojana (AGEY)
Provides safe, cost-effective, and affordable community-monitored transport services to rural areas which are not currently serviced by the market. Loans are provided at subsidised rates as an incentive for entrepreneurs to provide rural transport services for people and goods. For Individuals, loans up to Rs. 6.5 lakhs and for Groups (SHG/VO/CLF/PG/PE) Loans up to Rs. 8.5 lakhs are provisioned
One Stop Facility (OSF)
Envisaged as a business facilitation-cum-incubation center at the Block Level to provide business development services to existing nano-enterprises on a growth track. Each Block selected under the One Stop Facility will receive the support of a minimum of 150 enterprises. The scale of finance for Individual Enterprises is Rs. 2.5 Lakh and for Group Enterprises is Rs 5 Lakh with 10% entrepreneur contribution.
Micro Enterprise Development (MED):
MED scheme has the objective to support SHGs and their family member’s enterprises in the non-farm sector. This scheme is planned in such a way that the necessary hand-holding and post-enterprise grounding support to SHG women entrepreneurs shall be provided and the financing part will be mobilized from CIF and Banks/financial institutions. In each Block, there is a budget provision of Rs. 20 lakhs for supporting a minimum of 200 Enterprises.
Incubator
The objective of the initiative is to pilot strategies to scale up at least 150 existing women-owned/ women-led growth-oriented enterprises in a State/UT and create models for replicability. The enterprises supported will be in the manufacturing and service sectors, which are hamstrung by various facets of market failure and information asymmetry. The total duration of the incubation component is for three years. A provision of Rs. 10.70 Crore per State/ UT has been made for the promotion of incubators.
Cluster Promotion
Two types of clusters are primarily promoted under this program: Artisan clusters (handloom and handicrafts) and Sectoral clusters (food service, tourism, nutrition etc.) Soft interventions include design development, quality assurance, enterprise creation, market development, financing, technology upgradation, skilling, promoting responsible business interventions, strengthening the local ecosystem including the development of collective enterprises, and hard interventions like the creation of Common Facility Centers (CFCs) / Common Production Centers (CPCs) are supported under the initiative. Each cluster has the potential to engage at least 100 microenterprises throughout intervention.
Provision of Rs. 5 crore per cluster for setting up and operationalizing clusters has been made. Technical Support Agencies may leverage additional funds through convergence with existing government schemes such as the Scheme of Fund for Regeneration of Traditional Industries (SFURTI) and those of the Development Commissioner (Handicrafts) and Development Commissioner (Handloom).
Other Capitalization Support Extended to SHG members
To ensure more liquidity to the rural poor women, the government has taken several initiatives, which need to be leveraged substantially. For this, structured processes for identification, support and monitoring of potential entrepreneurs are being put into place. Standard Operating Processes and training modules on enterprise finance have also been developed.
Following are the initiatives for capitalization support extended to Self Help Group members:
- Collateral free loans up to Rs. 20 Lakh per SHG.
- Interest Subvention (Up to Rs. 3 Lakh loan @ 7% Rate of Interest)
- Every women SHG member having a Jan-Dhan Account is eligible for an Overdraft (OD) limit of Rs. 5,000.
Women Enterprise Acceleration Fund has been earmarked to support terms of credit guarantees and loans to individual SHG entrepreneurs.
Women Enterprise Acceleration Fund
A dedicated fund to catalyze and make available medium term to long term debt financing to SHG women entrepreneurs to invest in viable enterprises, start new businesses, grow and scale up existing enterprises.
For individual enterprises:
- Credit Guarantee Support for enterprises for loans up to Rs. 5 lakh for a maximum period of 5 years.
- Interest Subvention for loans up to Rs. 1.5 lakh for a maximum duration of 3 years.
For enterprise collectives/ FPOs:
- Collateral Support to Enterprise Collectives/ FPOs: Up to 50% (or up to Rs. 2 crore) of the total credit extended to lending institutions.
- Reimbursement of credit guarantee fees: Charges on maximum loan amount of Rs. 5 crore for a period of 5 years to the lending institution.
- Incentive for women collectives: Up to a maximum of Rs. 25 lakh or 10% of the credit borrowed will be provided to the collective.
Marketing Support
Support for market linkages is extended to women entrepreneurs including activities like organising Buyer-Seller meets, Saras Melas, support in setting up urban-based showrooms, connecting e-commerce websites etc.
The following are some of the market linkage support extended for Lakhpati Didis:
- www.esaras.in: Dedicated e-Commerce Platform for SHG products.
- Saras Gallery: Curated SHG Products.
- Alliance with e-commerce platforms like Amazon, Flipkart and Meesho for marketing SHG products
- Patanjali Association for On-line/Offline SHG product marketing, SOPs development and capacity building.
