Main schemes of sidbi

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Information about Main schemes of sidbi

Published on September 30, 2015

Author: NaazSheikh

Source: slideshare.net

1. Main Schemes of SIDBI National Equity Fund Scheme which provides equity support to small entrepreneurs setting up projects in Tiny Sector. Technology Development & Modernisation Fund Scheme for providing finance to existing SSI units for technology upgradation/modernisation. Single Window Scheme to provide both term loan for fixed assets and loan for working capital capital through the same agency. Composite Loan Scheme for equipment and/or working capital and also for worksheds to artisans, village and cottage industries in Tiny Sector. Mahila Udyam Nidhi (MUN) Scheme provides equity support to women entrepreneurs for setting up projects in Tiny Sector. Scheme for financing activities relating to marketing of SSI products which provides assistance for undertaking various marketing related activities such as marketing research, R&D, product upgradation, participation in trade fairs and exhibitions, advertising branding, establishing distribution networks including show room, retail outlet, wears-housing facility, etc. Equipment Finance Scheme for acquisition of machinery/equipment including Diesel Generator Sets which are not related to any specific project. Venture Capital Scheme to encourage SSI ventures/sub- contracting units to acquire capital equipment, as also requisite technology for building up of export capabilities/import substitution including cost of total quality management and acquisition of ISO-9000 certification and for expansion of capacity. ISO 9000 Scheme to meet the expenses on consultancy, documentation, audit, certification fee, equipment and calibrating instruments required for obtaining ISO 9000 certification. Micro Credit Scheme to meet the requirement of well managed Voluntary Agencies that are in existence for at least 5 years; have a good track record and have established network and experience in small savings-cum-credit programmes with Self Help Groups (SHGs) individuals. Major schemes 1. TechnologyDevelopment&ModernisationFund SIDBI has set up Technology Development & Modernisation Fund (TDMF) scheme for direct assistance of small sale industries to encourage existing industrial units in the sector, to modernise their production facilities and adopt improved and updated technology so as to strengthen their export capabilities. Assistance under the scheme is available for meeting the expenditure on purchase of capital equipment acquisition of technical know-how, upgradation of process technology and products with thrust on quality improvement, improvement in packaging and cost of TQM and acquisition of ISO-9000 series certification.

2. SIDBI in July 1996 had permitted SFCs and promotional banks to grant loans for modernisation projects costing upto Rs. 50 lakhs. The Coverage of the TDMF scheme has been enlarged w.e.f. 1.9.1997. Non-exporting units and units which are graduating out of SSI sector are now eligible to avail assistance under this scheme. 2. National EquityFund National Equity Fund (NEF) under Small Industries Development Bank of India (SIDBI) provides equity type assistance to SSI units, tiny units at five per cent service charges. The scope of this scheme was widened in 2000-01 raising the limit of loan from Rs. 6.25 lakhs to Rs. 10 lakhs and project cost limit from Rs. 25 lakhs to Rs. 50 lakhs. (a) The following are eligible for assistance under the scheme:- i. New projects in tiny and small scale sectors for manufacture, preservation or processing of goods irrespective of the location (except for the units in Metropolitan areas). ii. Existing tiny and small scale industrial units and service enterprises as mentioned above (including those which have availed of NEF assistance earlier), undertaking expansion, modernisation, technology upgradation and diversification irrespective of location (except in Metropolitan areas). iii. Sick units in the tiny and small scale sectors including service enterprises as mentioned above, which are considered potentially viable, irrespective of the location of the units (except for the units in Metropolitan areas). iv. All industrial activities and service activities (except Road Transport Operators). < (b) Project cost (including margin money for working capital) should not exceed Rs. 50 lakhs in the case of new projects in the case of existing units and service enterprises, the outlay on expansion/modernisation/technology upgradation or diversification or rehabilitation should not exceed Rs. 50 lakhs per project. (c) There is no change in the existing level of promoters' contribution at 10% of the project cost. However, the ceiling on soft loan assistance under the Scheme has been enhanced from the present level of 15% lakh per project to 25% of the project cost subject to a maximum of Rs. 10 lakhs per project. (d) 30% of the investment is earmarked for tiny units.

3. Single Window Scheme (SWS) Purpose To provide both term loan for fixed assets and loan for working capital through a single agency. The total working capital requirement of such units inclusive of all fund based facilities are to be taken into account for determining the working capital facility eligible for refinance Eligible Borrowers Entrepreneurs setting up new projects in MSE / tiny sector, new promoters acquiring unencumbered fixed assets of existing MSE concerns from PLIs and also existing well run units undertaking modernisation / technology upgradation and potentially viable sick units undertaking rehabilitation scheme Norms Scheme operated through SFCs / twin function IDCs / scheduled commercial banks / eligible state co-operative banks / scheduled urban co-operative banks Loan Limit - Not to exceed Rs.200.00 lakh Rehabilitation Of Sick Industrial Units Purpose For providing assistance for rehabilitation of potentially viable sick units Eligible Borrowers Potentially viable MSE units including units in cottage and village industries and in tiny sector, conforming to definition of sick MSE unit as prescribed in guidelines of Reserve Bank of India. The assistance is meant for sick MSE units for which proper rehabilitation packages have been drawn up. Units eligible for rehabilitation assistance should be capable of being restored to normal health within a reasonable time. Purpose To provide both term loan for fixed assets and loan for working capital through the same agency. The total working capital requirement of such units inclusive of all fund based facilities may be taken into account for determining the working capital facility eligible for refinance Eligible Borrowers Entrepreneurs setting up new projects in SSI / tiny sector, new promoters acquiring unencumbered fixed assets of existing SSI concerns from PLIs, as also existing well run units undertaking modernisation / technology upgradation and potentially viable sick units undertaking rehabilitation scheme Norms Scheme operated through SFCs / twin function IDCs / scheduled commercial banks / eligible state co-operative banks / scheduled urban co-

4. operative banks Term Loan - Not to exceed Rs.20 million Mahila Udyam Nidhi Scheme

5. This scheme aims to provide soft loan (Quasi equity) assistance to women entrepreneurs besides usual term loans for setting up industrial units in the small scale and tiny sector, as also for undertaking service activities eligible for assistance under the SIDBI refinance scheme. Eligibility New projects in tiny and small-scale sectors for manufacture, preservation or processing of goods (Tiny enterprises would include all industrial units and services industries (except Road Transport Operators) satisfying the investment ceiling. Existing tiny and small scale industrial units and service enterprises as mentioned above (including those which have availed of this loan earlier) for undertaking expansion, modernisation, technology upgradation and diversification. Sick units in the tiny and small-scale sectors including service enterprises as mentioned above, which are considered potentially viable. All industrial activities and service activities (except Road Transport Operators) in the SSI sector. Projects which avail of any margin money or seed/special capital assistance under the schemes of Central/State Governments, State Financial Corporation and other state level institutions or banks (except State investment subsidy) are not eligible for assistance under the scheme. Project Outlay Project cost (including margin money for working capital) should not exceed Rs.10.00 lakh in case of new projects. In the case of existing units and service enterprises, the outlay on expansion/modernisation/technology upgradation, or diversification or rehabilitation should not exceed Rs.10.00 lakh per project. Amount of soft loan Soft loan up to 25% of the project cost with a ceiling of Rs.2.50 lakh per project to meet the gap in equity as per prescribed Debt Equity Ratio (DER) of 1.857:1 (excluding State subsidy which may be retained for meeting working capital) after taking into account the promotors' own contribution equivalent to 10% of the project cost. In addition, term loan may be sanctioned as per usual norms under Refinance Scheme of SIDBI. Security Hypothecation of the articles purchased. 3rd party guarantee acceptable to the bank. No security including collateral security will be insisted upon from borrowers in respect of soft loan. Rate of Interest 1. Soft loan: Only service charge @ 1% p.a. is payable, which may be retained by lending office. 2. Term Loan: As per interest rates advised from time to time or structure under Refinance Scheme as fixed by SIDBI from time to time, in case refinance has been availed. For such prevailing rates, the concerned branch may be contacted. Repayment Soft loan is repayable within 10 years (inclusive of initial moratorium period of not more than five

6. years). However, the period of repayment of soft loan will be co-terminus with that of term loan. Extent of Refinance/Reimbursement of the Soft Loan Term Loan: As provided under the Refinance Scheme. Soft Loan: Soft Loan is reimbursed to the extent of 100%. Disbursement Soft loan is to be released in accordance with terms and conditions of sanction thereof and after the promoter(s) has (have) brought in her (their) own contribution in full. Bank has to act as agent of SIDBI for sanction, disbursement and recovery of soft loan. Mahila Udham Nidhi Scheme Q. Who can avail loan under Mahila Udyam Nidhi Scheme from your Bank? A. Entrepreneurs engaged in new projects in tiny and small scale sectors for manufacture, preservation or processing of goods ((tiny enterprises would include all industrial units and services industries (except Road Transport Operators) satisfying the investment ceiling prescribed for tiny enterprises viz. Rs. 5 lakh). Apart from this, all tiny and small scale industry entrepreneurs (including those who have availed this facility earlier) are also eligible for undertaking expansion, modernisation, technology upgradation and diversification. Sick units in the tiny and small scale sectors including service enterprises as mentioned above, which are considered potentially viable, besides all industrial activities and service activities (except Road Transport Operators) in the SSI sector, are also eligible for loan under this scheme. Q. What are the criteria for project outlay for financing under this scheme? A. The project cost criterion (including margin money for working capital) is as under: q for new projects: not exceeding Rs.10.00 lakh per project. q for existing units and service enterprises: the outlay on expansion/modernisation/technology upgradation, or diversification or rehabilitation should not be exceeding Rs.10.00 lakh per project. Q. How is the soft loan portion disbursed? A. The soft loan is to be disbursed in accordance with terms and conditions of sanction and only after the promoter(s) has (have) brought in her (their) own contribution in full. In this connection, the bank acts as agent of SIDBI for sanction, disbursement and recovery of soft loan. Q. What will be the soft loan amount? A. A soft loan under this scheme can be sanctioned up to 25% of the project cost with a ceiling of Rs.2.50 lakh per project to meet the gap in equity as per

7. prescribed Debt Equity Ratio (DER) of 1.857:1 (excluding State subsidy which may be retained for meeting working capital), after taking into account the promoters' own contribution equivalent to 10% of the project cost. In addition, term loan may be sanctioned as per usual norms under Refinance Scheme of SIDBI. Q. What will be the repayment period of the soft loan? A. The soft loan is repayable within 10 years (inclusive of initial moratorium period of not more than five years). However, the period of repayment of soft loan will be co-terminus with that of term loan. Q. What are the rate(s) of Interest charged for the soft loan and the term loan respectively? A. In case of the soft loan, only service charge @ 1% p.a. is payable, which may be retained by lending office. As for the term loan, the interest rates will be as advised from time to time OR structure under the Refinance Scheme as fixed by SIDBI from time to time, in case refinance has been availed. Q. What is the extent of Refinance/reimbursement of the soft loan that can be availed under this scheme? A. The term loan under the scheme will be provided as given under the Refinance Scheme. The Soft Loan, on the other hand, will be reimbursed to the extent of 100%. ASSISTANCE TO DISABLED ENTREPRENEURS Guidelines for Funding Projects: The ‘National Handicapped Finance and Development Corporation’ has been incorporated by Ministry of Social Justice and Empowerment, Government of India on 24th January, 1997 under section 25 of the companies Act., 1956 as a company not for profit. It is wholly owned by Government of India and has an authorised share capital of Rs.400 crores (Rupees Four Hundred crores only). Objectives: 1. Promote economicdevelopmentactivitiesforthe benefitof the personswithdisabilities. 2. Promote self-employmentandotherventuresforthe benefit/economicrehabilitationof the personswithdisabilities. 3. Assistindividualswithdisabilitiesorgroupof individualswithdisabilitiesbywayof loans and advancesforeconomicallyandfinanciallyviable schemesandprojects. 4. Grant concessional finance inselectedcasesforthe personswithdisabilityinthe country incollaborationwithGovernmentMinistries/DepartmentsatState level tothe extentof the budgetaryassistance granted bythe Governmentof Indiatothe company. 5. Extendloanstothe personswithdisabilityforpursuinggeneral/professional/technical educationfortrainingatgraduate and higherlevels.

8. 6. Assistinthe upgradationof technical andentrepreneurial skillsof personswithdisability for properandefficientmanagementof productionunits. 7. Setup training,qualitycontrol,processdevelopment,technology,commonfacility centersandotherinfrastructural activitiesforthe properrehabilitation/upliftmentof the handicappedpersonsinsupportof theireconomicpursuits. 8. Assistthe State level organisationstodeal withthe developmentof the personswith disabilitybywayof providingfinancialassistanceandinobtainingcommercialfundingor by wayor refinancing. 9. Work as an apex institutionforchannelisingthe fundsthroughState Finance Corporation for the HandicappedorthroughcorrespondingCorporationsauthoriesedbyState Govts./Boardssetupby UnionGovernment/StateGovernment/UnionTerritory AdministrationsandVoluntaryOrganisations.The NHFDCwill receiveproposalsfor financial assistance throughabove mentionedorganizationsandsanctionloansand marginmoneyto the beneficiariesfordisbursementthroughthese organizations. 10. Assistself-employedindividuals/groupof individualsorregistered factories/companies/cooperativesof disabledpersonsinmarketingtheirfinishedgoods and assistinprocurementof raw materials. 11. To develop,operateandimplementspecificpilotprogrammes,projectsandschemesin Indiainsupportof promotionof the self employment,economicactivitiesof the handicappedpersonswithaview of introducinginnovations,technological up-gradation and bridgingthe critical gapsof infrastructure,inputsupply,outputprocessingand marketing. 12. To undertake and/orsupporttechnically,manageriallyorfinanciallyresearchand evaluationstudies,techno-economicandrelatedsurveys,preparationandappraisal of projectreportsand documents,feasibilityandotherstudiesfordevelopingviable programmes,projects,schemesforthe benefitof handicapped. 13. To establish,maintain,subscribe ortosubsidise orbecome memberof training institutions,researchlaboratoriesresearchinstitutionsandexperimental experiments. SchemeforFinancingProjects: The corporation can assist a wide range of income regenerating activities. Infrastructure development schemes alone will not qualify for financing unless it leads directly to income generation. For a disabled person living below the income/economic criteria, the proposals should be such which generate adequate income to the disabled person to rise above the economic criteria limit. 1. SelfemploymentinSmall Businesse.g.Service/Tradingsector: Loan will be provided for self employment of disabled persons in service sector or for trading activity. The Small Business, project or activity for which financial assistance has been sought, will have to be operated by the disabled person himself and employing at least 15 % disabled persons in his venture. Maximum loan available under this scheme is Rs.2.50 lakh.

9. Indicative areas of financing are: 1. Shopsor Storesof anytype 2. Workshopsor repairshopsor service centres 3. Healthcentre/Beautyparlour 4. Computercentre (training&jobwork) 5. Studio/Photography 6. Printingpress 7. Telephone/Fax/Email booth 8. Tailoring 9. Travel agency 10. Xerox centre 11. Transport service 12. Poultryfarming 13. Handicraft 14. Brassware 15. Dealership 16. Franchise 17. School fordisabled 18. Weaving 19. BookBinding 20. Leatherwork 21. Physiotherapy 22. Music schools 23. Computerhardware Dealership 24. Dealershipof petroleumproducts 25. Candle andchalkmaking 2. Assistance to DisabledEntrepreneurs: Loan may be provided for manufacturing, fabrication and production activity. The disabled person will be the owner/chief executive of the company and employing at least 15% disabled persons. Maximum amount of loan provided under the scheme is Rs.20.00 lakh. Illustrative list is given below: 1. Ancillaryproductsmanufacturing 2. Software developmentandmarketing 3. Fisheries 4. Dairyfarming 5. Diamondcuttingandpolishing 6. Foodprocessing 7. GarmentsManufacturing

10. 8. Potteries 9. Furniture manufacturingincludingmouldedfurniture 10. Plasticmoulding 11. Agro basedindustry 12. Herbal products 13. Packaging Any other suitable manufacturing/processing activity besides above: 3. Assistance to Disabledfor Higher Studiesor Professional Training: Towards the fulfillment of the overall objectives of empowerment and development of disabled persons in the country, the Corporation provides financial assistance to eligible beneficiaries in two components viz., educational /training grants and loans (In pursuance of objective (5) & (6) of MOA). Financial assistance from the corporation would flow towards training and Education requirements of the disabled groups under both formal and non-formal education/training, which would impart useful knowledge and skill. Formal training would equip the beneficiary to improve his/her chances of employment and self-employment through completing appropriate vocational/academic courses leading to the certificate /diploma or other qualification. While higher education (under graduate, post-graduate and doctoral studies) applications would be considered for loan whereas applications for technical education/ training leading to diplomas and certificates will be considered as grants, which would meet the beneficiary's expenses towards both tuition fees and hostel facilities provided no other financial assistance or concession(s) is available from any other source for this purpose. Channelising Agencies are required to furnish lists of recognised institutions identified for imparting training in these areas, which will be approved by the Corporation. Additionally, technical training including non-formal training wherever required will not form part of the project and the expenditure incurred therein will not form part of a loan. 4. Assistance for Agricultural Activities: Loan assistance is provided to disabled persons for: 1. Agriculture productionandrelatedfieldsuchasirrigation,purchase of agriculture machinery,horticulture,sericulture etc. 2. Purchase of equipmentforagriculture servicessuchascustom service (pesticide, spray,harvestingetc.) customhiringof agriculture machinery. 3. Agriculture marketing(throughco-operative societies/Associationof disabled farmers),Settingupgradingandpackinghouses,purchase of transportvehicles

11. for marketingof agriculture produce etc. 4. Purchase of landfor agriculture purpose byindividualdisabledpersonorbyco- operative societiesof disabledpersons. 5. Commission agentsatMandi Samities. 6. Small businesssuchasretail outletsformarketingOrganicfertilizers, Pesticides/insecticides.Improvedvarietyof seeds,farmmachineryetc.Maximum loanavailable underthisscheme isRs.5.00lakh. 5. Scheme to Promote Manufacturing/Productionof Assistive DevicesforDisabled persons: Loan Assistance is provided for setting up small scale industry for manufacturing aids and appliances developed under R & D programmes of Government/academic institutions of repute for disabled within the country. The company should employ disabled persons. Maximum loan available under this scheme is Rs.25.00 lakh. 6. Assistance for Skills& Entrepreneurial DevelopmentProgrammes: 1. Financial assistance inthe formof loanisprovidedtothe channelisingagencies, reputedNGO's,RRTC's andrecognisedtechnical institutionsforimpartingskills and entrepreneurial developmenttrainingtodisabledpersons. Financial assistance isalsoprovidedforsettingupvocational trainingcentres includingcomputertrainingcentre,exclusivelyforimpartingskillsand entrepreneurialdevelopmenttrainingtodisabledpersons. 2. The proposalsforloanshouldnecessarilyindicate placement/self employment opportunitiestothe disabledaftertraining. 3. Financial assistance inthe formof loanwill alsobe availableforupgradationof skillsof disabledworkersandentrepreneurswhohave setupunitswiththe financial assistance fromNHFDC. 7. Scheme to Promote SelfEmploymentamongst Personswith Mental Retardation, Cerebral Palsy and Autism: Persons with mental retardation, cerebral palsy or autism may not be eligible to seek loan and enter into a legal contract. In such cases following categories of persons are eligible for financial assistance from NHFDC. 1. Parentsof dependantmentallyretardedpersons. 2. Spouse of dependantmentallyretardedpersons. Persons seeking loan from NHFDC under this category should encourage self

12. employment of the mentally retarded persons. Projects should be identified in such a way that there is direct involvement and participation of the beneficiary in the project. Indicative areas for financing are: 3. Shopor store 4. Assemblingunit 5. Workshopor repairshop 6. Envelopmakingunit 7. Pickle,papad,wadi makingunit 8. Home unitfor makingsquash,jam etc. 9. Bakery 10. Xerox Centre 11. Tailoringunit 12. DTP Centre 13. ScreenPrinting 14. Poultry 15. DairyFarming 16. Horticulture 17. HandloomUnit 18. Block,textile printing Maximum loan available under this scheme is Rs.2.50 lakhs Eligibility Criteria CriteriaofDisability The beneficiary should be a disabled person or a cooperative society of disabled persons or a legally constituted association of disabled persons or a firm promoted by disabled persons unless otherwise mentioned in the scheme for financing. In order to be eligible for loans on concessional interest rates from the Corporation, minimum degree of disability shall not be less than 40 percent. A person with disability means a person: 1. Who isblindor 2. Who isa personwithlow vision,or 3. Who isspeechandhearinghandicapped,or 4. Who has a locomotordisabilityonaccountof orthopedicorneurological impairment (includingcerebral palsy) or 5. Who ismentallyretarded,or 6. Who ismultiple handicapped,andincludesanypersonswhoisunable toensure by himself/herself,whollyorpartly,the necessitiesora normal individual orsocial life includingworkasa resultof deficiency,whethercongenital ornot,inhis/herphysical or

13. mental capabilities. Explanation for the purpose of the disabilities mentioned above: 1. a personshall be deemedtobe blindif he suffersfromeitherof the followingconditions, namely: 1. total absence of sight,or 2. visual acuitynotexceeding6/60 or 20/200 (snelleninthe bettereye with correctinglenses) or 3. limitationof fieldof visionsubtending anangle of 20 degree orworse. 2. a personwithlowvisionisone whohasimpairmentof visual functioningevenafter treatmentand/or standardrefractive correction,butwhouses,orispotentiallyableto use visionforthe planningorexecutionof atask withappropriate assistivedevice. 3. a personshall be deemedtobe deaf if he/she haslostsixtydecibelsormore inthe better ear inthe conversational range orfrequencies. 4. a personshall be deemedtohave locomotor disabilityif he ishavingdisabilityof the bones,jointsormusclesleadingtosubstantial restrictionof the movementof the limbs or if has any formof cerebral palsy. 5. mental retardationreferstosub-averagegeneral intellectual functioning,which originatesduringthe developmentperiodandisassociatedwithimpairmentina adaptive behaviour. 6. mentallyill personshall have the same meaningasassignedtothe wordinpara (i), Section2, ChapterI of Mental HealthAct. 1987. 7. Leprosy-curedpersonsmeanandincludedleprosycuredpersons – 1. withlossof sensationinhandsor feetaswell asof sensationandparesisinthe eye andeye lidbutwithno manifestdeformity; 2. withmanifestdeformityandparesisbuthavingsufficientmobilityintheirhands and feettoenable themtoengage innormal economicactivity; 3. sufferingfromextreme physical deformityaswell asadvancedage which preventsthemfromre-enteringintoanyeconomicactivity; 8. multiple handicappedmeansandincludesapersonwithmore than one disability. Economic/IncomeCriteria Unemployed disabled persons whose family income is below Rs.22,000/- p.a. for rural areas and Rs.24,000/- p.a for urban areas (two times of poverty line) are eligible for availing loan facility. (Family means parents or spouse of dependent disabled) In case of self dependent disabled, the income of the individual will only be taken into account. The economic criteria will also be applicable to each member of a cooperative society of disabled persons, association of disabled persons and firm promoted by disabled persons seeking financial assistance from NHFDC. Minimum age limit for availing loan is 18 years and maximum age is 55 years. However, the maximum age could be relaxed in the case of professionally, qualified entrepreneurs.

14. The sanctioned loan amount and repayment period will depend on the age of applicant. Other Requirements The applicant: 1. shouldbe an Indiancitizen; 2. shouldbe domicile of the state where the projectisproposedtobe putup; 3. shouldhave relevanteducational/technical/vocational qualification/experience/background; 4. shouldnothave any large outstandingdebtfromotherorganisationandshouldnotbe financial defaulter; 5. shouldbe fromagriculture backgroundandprojectlocationshouldbe in agriculture area if seekingloanunderthe scheme ‘Assistance forAgricultural Activities’. Types of Funding: NHFDC can consider following types-of loans; 1. Term Loan The Corporation can consider grant of Term Loan to a disabled entrepreneur or group of disabled entrepreneurs through the channelising agency. Under Term Loan Scheme, loans are given upto 100% of project cost as follows: For the project with high working capital component, quantum of loan will depend upon the total cost of the project as follow: 1. Where the total cost of the scheme doesnotexceedRs.50,000 the scheme will be treatedas a composite loanandno distinctionwill be made betweenfixed assetand workingcapital.Insuchcasesloanscan be grantedupto100% of the total cost. 2. Where the unitcost of the projectismore than Rs.50,000 but doesnot exceed Rs.1,00,000 the ratioof fixedassetstoworkingcapital willnotexceed1:3. 3. Where the unitcost of the scheme exceedRs.1.00lakh,only50% of the working capital requirementwillbe addedinthe projectcostas workingcapital marginto arrive at the unitcost of the project,remainingamountof the workingcapital will have to be financedbythe banksas cash creditlimit. In order to cover maximum number of beneficiaries, 75% of the amount of term loans sanctioned in any financial year to a Channelising Agency shall be for those projects where NHFDC loan component is below Rs.1,00,000 per unit. Details of the Projects

15. Project Cost NHFDC Share Channelising Agency share Promotor's share BelowRs.50,000 100% Nil Nil Above Rs.50,000 and upto1.00 lakh 95% 5% Nil Above Rs.1.00 lakhand upto Rs.5.00 lakhs 90% 5% 5% Above 5.00 lakhs 85% 5% 10% 2. Margin MoneyLoan (SeedCapital) 1. SeedCapital assistance isprovidedtoentrepreneursavailingtermloanfrom State Financial Corporation(SFCs) /otherfinancialinstitutionbutnotable to bringin theirshare of equitystipulatedbythe termlendinginstitutions. 2. SeedCapital assistance istomeetthe gapin the equitystipulatedbythe term lendinginstitutionsaspertheirnormof debitequityratio. 3. The entrepreneuristobringina minimumof 20% of the equity. 4. NHFDC mayprovide SeedCapital assistance upto80% equityrequiredtobe fundedbythe beneficiaryforthe total projectcostupto Rs.50 lakhs. 5. SeedCapital assistance isfree of interestbutthe channelisingagencieswilllevya service charge of 1% p.a fromthe beneficiariesandpay0.5% p.a to NHFDC. 6. SeedCapital istobe repaidwithinamaximumperiodof 7yearsfromthe date of firstdisbursement,inclusive of suitable moratorium.Incaseswhere seedCapital assistance remainsunpaidbeyond7years,the same shall be convertedinto termloan at the expiryof 7th year at an interestapplicable toNHFDCtermloan and shall be paidwithin3years inquarterlyinstalmentsfromthe date of conversionintotermloan. The Margin Money Loan maybe recoveredfromthe beneficiaryalongwithbank loanin the same proportion,whichthe MarginMoneybearsto the bank loan. Basedon such recoveriesthe ChannelisingAgencyorotheragencywill make the repaymentscheduleof marginmoney. 7. ProjectsconsideredforSeedCapitalassistance shall notbe eligible foranyother financial assistance fromNHFDC Rate of Interest Loan Amount Interest by NHFDC Interest (Channelising Agency) Total

16. Loan amountlessthanRs.50,000 3% 2% 5% Loan amountabove Rs.50,000 and uptoRs.1,00,000 4% 2% 6% Loan amountabove Rs.1,00,000 and upto5,00,000 7% 2% 9% Loan amountabove Rs.5,00,000 8% 2% 10% 8.  For womenwithdisability,arebate of 2% on interestisprovided.  A rebate of 0.5% on interestisprovidedfortimelyrepaymentof loan. Allocation of Available Fund for Disbursement 1. In orderto covermaximumnumberof beneficiaries,75% of available fundisearmarked for those projectswhere NHFDCloanisbelow 1.0lakh. 2. In orderto ensure economicempowermentof disabledwomenandtoensure general balance,channelisingagenciesare tobe givendue weightagetowomenapplicantsand special effortsshouldbe made toattract projectsformwomen. Sanction of Loan 1. Loan will be sanctionedbychannelisingagencyforfinal disbursementtobeneficiarywith priorapproval of NHFDC.The channelisingagencywill sendall applicationsforloanduly recommendedforapproval of NHFDC. 2. For loanunderscheme(5) productionof assistivedevicesandscheme (6) assistance for skill &entrepreneurial development,applicationwillbe receivedandappraisedby NHFDC directly.The loanwill be sanctionedanddisbursedbyNHFDC. 3. Board of Directorsof NHFDCwill sanctionall projectswithloancomponentexceeding Rs.10 lakhs. Recovery of Loan 1. The entire loanshall be repaidwithinareasonable periodbutnotexceeding7 years includingthe moratoriumperiod.The repaymentshall be onhalf yearly/ quarterly/monthlybasis.Foragriculture andhorticulture projectsrepaymentshallbe on yearlybasis.The repaymentperiodwillbe workedoutduringappraisal andsanctionof scheme onthe basisof income potentialof the proposedproject. 2. A suitable moratoriumperioddependingonthe meritandrequirementof the projectwill be allowed. 3. A rebate of 0.5% on interestisprovidedfortimelypaymentof all instalment. 4. A penal interestof 3%will be chargedfromchannelisingagencyfordefaultintimely repayment.The channelisingagencywillalsocharge panel interestof 3% fromthe

17. beneficiaryfordefaultinrepayment. Security 1. BlockGovernmentguarantee isrequiredfromconcernedState Governmentforthe sanctionanddisbursementof loanbyNHFDCto State ChannelisngAgencies.Incase of persistentdefault,the NHFDCwillbe atlibertytoinvoke the guaranteesordeductits instalmentsfromthe future projectsof the concernedagencytobe financed. 2. NHFDC mayalsoaccept Bank Guarantee or anyotherform of securityacceptable toitfor grant of loans. For Application Form for Financial Assistance and Further Details Please Contact: National Handicapped Finance and Development Corporation (Ministry of Social Justice and Empowerment, Government of India) Red Cross Bhavan, (opp. Mini Secretariat) Sector – 12, Faridabad – 121 007 (Haryana) National Handicapped Finance and Development Corporation (NHFDC) Schemes of NHFDC The corporation provides financial assistance for wide range of income generating activities to disabled persons. These are: i. For settingup small businessinService / Trading sector : Loan up to Rs. 3.0 lakh for sales/trading activityand Rs. 5.0 lakh for service sector activity ii. For purchase of vehicle includingautorikshaw for commercial hiring:Loan upto Rs. 10 lakh. iii. For settingup small industrial unit: Loan uptoRs. 25 lakh. Loan assistance isprovidedto disabledpersonsformanufacturing,fabricationandproduction. iv. For Agricultural activities:Loan uptoRs. 10 lakh Loan assistance isprovidedtodisabled personsforagricultural production,irrigation,horticulture,sericulture,purchaseof agricultural machinery/equipmentforagricultural services,marketingof agricultural productsetc. v. For self-employmentamongstpersonswith mental retardation, cerebral palsy and autism: Loan upto Rs. 5 lakh,In such cases,the financial assistance isextendedthrough parentsor spouse orlegal guardianof the dependantmentallydisabledperson. vi. Loan for Professional /Educational / Training courses: Loan upto Rs. 7.50 lakh for studiesinIndiaandupto Rs. 15 lakh forstudiesabroad. vii. Micro CreditScheme by State ChannelisingAgenciesimplementedthroughNGOs. - Loan uptoRs 5 lakh foreach NGO andRs. 25,000/- for each beneficiary. viii. Parents'Associationof mentallyretardedpersons - LoanuptoRs. 5 lakh ix. Financial Assistance for Skills& Entrepreneurial Development (inthe formof grantto

18. channelisingagencies/reputedtraininginstitutionsforimpartingskillsand entrepreneurialdevelopmenttrainingtodisabledpersons) Eligibility Criteria for availing credit  AnyIndianCitizenwith40% or more disability.  Age between18and 60 years.  Annual income below Rs.5,00,000/- (RupeesFiveLakhonly) perannumforurbanareas and Rs.3,00,000/- (RupeesThree Lakhonly) perannumforrural areas.  Relevanteducational /technical /vocational qualification/experienceandbackground. Rates of Interest Sl. No. Loan Amount Rate of Interest(Per Annum) 1. Upto Rs.50,000/- 5% 2. Above Rs.50,000/- and uptoRs. 5 lakh 6% 3. Above Rs.5.0 lakh 8% Repayment General scheme of financing: within 10 years, Education loan-within 7 years (after 6 months from the date of completion of course or after getting the job, whichever is earlier), Micro Credit Loan: within 3 years. Rebate A special rebate of 1% on interest is given to women with disabilities in all the schemes of NHFDC. Procedure for obtaining loan Applications on prescribed format to be submitted through the State Channelising Agencies (SCAs) of NHFDC. The address of SCAs are given in Annexure-I (-1 ) (PDF file that opens in a new window). (For further details, log on to NHFDC website: www.nhfdc.org (External website that opens in a new window))

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