Women SHGs to get bank loans at 7 per cent interest
Posted on: 05:06 AM IST May 07, 2013
New Delhi: Women's self help groups in the country would be provided bank loans at an interest rate of seven per cent from now on, Rural Development Minister Jairam Ramesh said on Monday. The scheme would be initially started as a pilot project in 150 districts and in rest of the states, 75 per cent of the cost would be borne by the central government and 25 per cent by the states.
"Over the next five years, we will move to a situation where the entire cost will be borne by the centre," Ramesh told reporters in Delhi. The total cost of the project which was approved by the cabinet on May 1, 2013, would be Rs 1,650 crore for 2013-14 out of which Rs 1,400 crore would be borne by the central government and Rs 250 crore by the states.
The cabinet also decided to do away with the BPL (below poverty line) category in the National Rural Livelihood Mission (NRLM) of which the women's Self Help Group scheme is a part. "From now on, who the poor women are would be decided by the gram sabha," Ramesh said.
There are around 25 lakh women's self help groups in the country with nearly 3 crore members. Ramesh said that over the next five years, the number of members is likely to go up to 7 crore. The minister said he has proposed a separate Nabard-like institution to promote women's SHGs to Finance Minister P Chidambaram.
The National Rural Livelihoods Mission (NRLM) was launched in June 2011. Aided in part through investment support by the World Bank, the mission aims at creating efficient and effective institutional platforms of the rural poor enabling them to increase household income through sustainable livelihood enhancements and improved access to financial services.