Micro Finance Scheme (For SHGs)

The concept of Self-Help Group (SHG) is gaining momentum in the recent years as a tool of all-round development of the economically weaker section, particularly women in rural areas. For the proliferation of jute diversified activities the National Centre for Jute Diversification (NCJD) under the aegis of the Ministry of Textiles, Govt. of India thought it prudent to supplement this process with the need based financial assistance to such SHGs who are engaged in JDP manufacturing activities and are interested to expand their activities further. Financial assistance in the form of interest free loan to such SHGs would not only enhance their production capacity but would also make their products more competitive in the market because of their capability to meet the bulk requirement of the buyers. This would ultimately lead to enhancement in their income substantially.

Primary objective of NCJD

 

To enhance production base for jute diversified products involving SHGs.

 

To supplement the efforts of SHGs for adopting economically sustained activities through production of Jute Diversified Products.

 

To create employment opportunities in-groups and involve women in large numbers in income generating activities.

 

To create awareness about potentials of jute based activities as a medium of sustainable human development and thereby assisting economically disadvantaged people especially those in rural areas.

 

To encourage environment friendly practices.

 

To promote JDP activities in clusters across the country.

Programme

Under this programme (MFS), financial support to SHGs for taking up of Jute Diversified Products manufacturing activities will be provided 25 % of the project cost subject to maximum Rs. 1.00 lakh as interest free loan to SHGs towards margin money. The project proposals of the SHGs may also be linked with other promotional schemes of the banks/ financial institutions/Rural Development Programmes/KVIC etc. The financing to SHGs would be on composite basis that would include capital requirement as well as working capital. The interest free margin would facilitate leverage of funds under other scheme/programmes. The loan would be repayable over a period of five years after commencement of commercial production.

Eligibility

While selecting SHG for financial assistance following guidelines will be followed:

 

The SHG must be promoted by registered NGO/promotional institutions which have good past records of timely realization of loan amount.

 

SHG should have achieved eligibility criteria for credit assistance as per bank's norms.

 

SHG should have worked for a minimum period of one year and should have obtained training on production of Jute Diversified Products from recognized training centre.

 

Resolution of the governing body of the SHG for  undertaking such JDP activities as proposed.

 

Resolution of the SHG's Governing Body adopted for accepting interest free loan from NCJD and timely refund of loan.

 

SHG should have background of undertaking income generation projects and experience in the field of handicrafts/handloom.

 

Majority of members of SHG should be women

 

SHG should have infrastructure for implementation of the proposed project.

 

SHG should have effective management and working team.

 

SHG should have good co-ordination with local administration.

 

SHG should be recommended by concerned Bank.

 

Preference for those having marketing experience.

Identification

Awareness Workshops will be organized at regular interval in different places allover the country. Such workshops will be organized involving the respective JSCs, JRMBs, State Govt. bodies, DIC/DRDAs, NGOs and other agencies involved in economic upliftment programmes in that particular region to highlight the scope for jute related income generation activities along with the display of various jute diversified products so as to provide them with visual perception of the products. The institutions that are engaged in income generating activities would be requested to forward the project proposals of eligible SHGs for financial assistance.

Selection & Screening

All the project proposals will be subjected to scrutiny of all the relevant documents and also the assessment of the financial viability of the project along with the recommendation from the respective State Govt. / DIC / DRDA etc. The project proposals found eligible will be placed before Sub-Committee for NGOs / SHGs/ Entrepreneurs (MFS) for final sanction. Thereafter the decision will be reported to recommending agency and on acceptance of the proposal by the Committee, a Memorandum of Understanding between the NGO/SHG and NCJD will be executed.

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