Lending schemes for minorities shelved as state funds dry up

The Uttar Pradesh Minorities Financial Development Corporation (UPMFDC) has been forced to shelve lending schemes after the state failed to bear its share of the costs and provide guarantee for utilising the funds.

Written by Tarannum Manjul | Lucknow | Published: July 19, 2010 4:19 am

The Uttar Pradesh Minorities Financial Development Corporation (UPMFDC) has been forced to shelve lending schemes after the state failed to bear its share of the costs and provide guarantee for utilising the funds.

The corporation employees have now written a letter to the Union minister of Minorities Welfare,Salman Khurshid,asking him to intervene in the matter.

The channelising agency of the National Minorities Development and Finance Corporation,the UPMFDC was established in 1995 following the introduction of the Prime Minister’s 15-point programme. Its chief work is to implement Central schemes for minority welfare.

Some of its biggest programmes include providing term loans up to Rs 50,000 on low interest rates to artisans,farmers and weavers from minority communities,margin money loan,micro-financing loan scheme and education loan upto Rs 2.5 lakh on 3 per cent interest. For these schemes,the NMDFC releases funds through the UPMFDC. The centre-state ratio of funds is 85:15.

But the schemes have been defunct for four years. In this period,the Centre released nearly Rs 120 crore,but the state has neither given its share nor provided the guarantee for utilisation.

An official of the corporation said: “These were some of our most popular schemes. Since our interest rates are lower than banks and the paperwork is easy,students preferred our education loan scheme.” Agreeing that the schemes are non-functional due to non-release of state funds,Corporation Managing Director Vimal Chandra Srivastava said: “We are also having a tough time recovering loans and we do not have sufficient staff.”

The employees had written to Chief Minister Mayawati on her birthday,requesting her to take steps to ensure that the schemes become functional again.

“The lending schemes helped many families,” said Mohd Waleem,the president of the employees’ federation. “Many meritorious students were able to pursue higher studies because of our low interest loans. But in last four years,no new loans have been sanctioned.”

In 1995,when the corporation was formed during Mayawati’s first term as chief minister,she had written to the chief secretary to ensure that it was regularly provided with funds for its schemes.

A similar situation had arisen in 2005 during the tenure of Mulayam Singh government,following which the corporation employees had gone on strike. The matter,however,was resolved soon with intervention from BJP legislators.

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