The Sikhs, Muslims, Christians, Zoroastrians, Buddhists, Jains communities in India are classified as minority communities as per notification of Ministry of Welfare, Government of India. In 121 districts in the country, the minority population exceeds 25% of total population of the districts. Further, in the states of J & K, Punjab, Meghalaya, Mizoram, Nagaland and in U/T Lakshadweep the classified minority communities are in the majority. As per RBI directives, the scheduled commercial banks are required to specially monitor the credit flow to minorities in the 121 districts where their concentration is identified as more than 25% of total population. In addition to the above, each bank has a special cell headed by DGM/AGM or similar officer functioning as a Nodal officer to ensure that minority communities receive a fair and equitable portion of credit within the overall target of the priority sector.
Assistance is available to minority communities for any commercially viable and technically feasible ventures like Agriculture & Allied, Technical Trade, Small Business, Artisan & Traditional Occupations, Transport, and Service sector. National Minority Development Finance Corporation (NMDFC) provides loan to the individuals through the SCAs at 6% p.a. on reduced balance. The maximum loan will be to the extent of 85% of the project cost subject of a maximum of Rs.425000/- (project cost up to Rs.5 lakh). The remaining cost of the project shall be met by the SCA and the beneficiary (it is obligatory that the beneficiary shall contribute his share of minimum 5% of the project cost).
Lending at concessional rate to persons fitting below creamy layer:
NFDMC is disbursing stream of concessional credit to minority communities on the basis of annual income eligibility of up to Rs.6.00 lakh per annum.
Under the scheme NMDFC facilitates;
- Term Loans up to Rs.20.00 lakh at 6% p.a.
- Micro Finance up to 1.00 lakh at 7% p.a.
- Education loan up to 15.00 lakh at 3% p.a. for professional and job oriented degree courses at Rs.3 lakh per annum for maximum 5 years. The education loan up to 20 lakh is also admissible for course abroad at Rs.4 lakh per annum to individuals for maximum 5 years.
Means of financing for all the above types loan will be in the proportion of NMDFC @ 90%, the State channelizing agency (SCA) @ 5% and the beneficiary @ 5% of total cost for all the above loans.
Margin Money scheme:
NMDFC implements Margin Money schemes to the backward sections amongst the minorities through the State Minority Finance Corporation of the respective State/Union Territory Governments. Under the scheme up to the loan amount Rs.5.00 lac NMDFC, the State channelizing agency (SCA) and the beneficiary in the proportion of 25%, 10%, and 5%, respectively and rest of the project cost (60%) will be under bank finance. Interest charged by NMDFC will be @ 3% per annum, on the reduced balance. The maximum share of NMDFC finance restricted to Rs. 1.25 lac per individual.
The students belonging to minority communities are eligible for subsidies, who have secured admission abroad for pursuing Post-Graduate Diploma, Masters, M.Phil and Ph.D level etc. The amount of subsidy is equivalent to 100% of interest charged to the loan account during the entire period of the moratorium (that is, from the date of loan to one year after the completion of course period or six months after getting a job, whichever is earlier).This assistance is available to students whose overall family income is not more than Rs.6.00 lakh per annum. It is important to note that the Ministry of Minority Affairs (MoMA) would release subsidy component of the educational loan availed by minority students from the banks only for the loan amount up to Rupees Twenty Lakh under the scheme. The above condition for education loan provided by the banks is uniform in all Public Sector Banks/ Scheduled Commercial Banks and Urban co-operative banks.
Mahila Samridhi Yojana:
Under this scheme, training is given to a group of around 20 women in any suitable women friendly craft activity like tailoring, cutting and embroidery etc. through NGOs/SCA of NMDFC. The trainee group will be subsequently molded as Self Help Group (SHG) during the training period. The training period will be for a maximum period of 6 months. After the training, need based micro credit up to Rs.1.00 lac is provided to the each SHG members at the interest rate of 7% p.a. NMDFC reimburses training expenses of Rs.1500/- per month per trainee and also offers the stipend of Rs. 1000/- per month to the participants during the training period.
The DRI loans which are meant for economically weaker section of the society may also be granted to persons of minority communities at a concessional rate of interest of 4% per annum through State Minority Finance/Development Corporations, provided beneficiaries meeting the eligibility criteria of DRI scheme.
Priority sector target meant to minority communities:
In all the types of bank credit under the priority sector advances, (agriculture, micro enterprises, advances to weaker section), 15% of targets/outlays are earmarked for minorities.
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