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Tuesday, October 19, 2021

Nirmala Sitharaman announces 2% interest subvention for MUDRA-Shishu loans

The minister said that "total relief will be worth Rs 1,500 crore," and added that this interest subvention is going to benefit over 3 crore people. Separately, she announced an extension of Credit Linked Subsidy Scheme (CLSS) for housing sector up to March 2021.

By: Express Web Desk | New Delhi |
May 14, 2020 6:43:09 pm
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Union Finance Minister Nirmala Sitharaman today announced a 2 per cent interest subvention on loans given under MUDRA-Shishu, which is the smallest category of loans provided under the Micro Units Development and Refinance Agency (MUDRA).

The minister said that people having MUDRA-Shishu loans (which are up to Rs 50,000) will be eligible for this subvention scheme. She said that “total relief will be worth Rs 1,500 crore,” and added that this interest subvention is going to benefit over 3 crore people.

 

This announcement was a part of the second tranche of economic measures aimed at benefiting migrants, street vendors, small traders and farmers.

Various micro and small businesses under the MUDRA scheme have severely got affected because of the nationwide lockdown, that has halted economic activity for over a month. This, in turn, has also affected the capacity of these businesses to pay their loan instalments.

Separately, for the middle income group people having an annual income between Rs 6-18 lakh, the minister announced an extension of Credit Linked Subsidy Scheme (CLSS) for the housing sector up to March 2021.

Sitharaman said that this particular scheme has benefitted 3.3 lakh middle-class families so far, adding that around 2.5 lakhs middle income families will benefit from this during 2020-21.

She further went on to add that this will lead to an investment of over Rs 70,000 crore in the housing sector and will also create jobs, stimulate demand for steel, cement, transport, and other construction materials.

Reacting to the announcement on housing sector, Anuj Puri, Chairman of ANAROCK Property Consultants said, “The government’s push for affordable housing has been unmistakeable in the last six years. Its Housing for All by 2022 project has already resulted in multiple sops and incentives. As a consequence, there has been a significant increase in activity in affordable segment over the last few years. As per our research, there are currently 15.62 lakh under construction units across the top seven cities, of which nearly 39 per cent are in the affordable segment priced <Rs 40 lakh budget”.

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