Journalism of Courage
Offering a Rs 1,400-crore sop to rural women ahead of Lok Sabha polls, the Congress-led government has rolled out a scheme to give women Self Help Groups (SHGs) across 150 backward districts loans at 7 percent interest per annum.
The scheme that rolled out from February 1 will be applicable with retrospective effect, from April 1, 2013 and cover all loans taken post that date. The scheme had been approved by the Union cabinet in May last year, but is being rolled out only now. The reason is believed to be the Lok Sabha polls.
Bank loans upto Rs 3,00,000 to women SHGs in these 150 districts — which include all Left Wing Extremism affected districts and some backward districts -—will be given at 7 per cent interest against the 10-13 per cent market rate. This is the same rate at which farmers are given crop loans. The lower interest for women SHGs is a key initiative under the Rural Development ministry’s National Rural Livelihoods Mission.
“As of now, the scheme is going to be implemented in 150 districts but our aim is to include all 640 districts in the next five years, “ Rural Development minister Jairam Ramesh said on Monday.
For the current financial year, in districts other than the 150, SHGs will have to take the loan at market rate of interest upfront, and will get a rebate of the difference between repayment based on market rate and that based on 7 percent, in case of prompt repayment.
The cost of this interest subvention would be Rs 1,400 crore to be borne by the Rural Development ministry.
Currently, there are nearly 25 lakh Women SHGs in the country.
