National Handloom Development Programme: Concessional Credit/Weaver MUDRA Scheme

The 'Concessional Credit/Weaver MUDRA Scheme' is a component of the National Handloom Development Programme (NHDP) launched by the Ministry of Textiles, Government of India to make available the credit to handloom weavers at concessional interest rates.

The scheme aims to provide adequate and timely assistance from the banks to the handloom sector to meet their credit requirements for term loan & working capital in a flexible and cost effective manner across the country.

All Scheduled Commercial Banks, Regional Rural Banks, State Cooperative Banks, District Central Co-operative Banks and any financial institution with the approval of Competent Authority of Ministry of Textiles, GoI.

The Concessional Credit/Weaver MUDRA Scheme offers various benefits, including Margin Money Assistance, Interest Subvention, and Credit Guarantee.

Individual Handloom Weaver/Weaver Entrepreneur - Margin Money assistance @20% of loan amount, subject to maximum of [?]25,000/-.

Handloom organization - Margin money assistance @20% of loan amount, subject to maximum of [?]20.00 lakh (margin money @[?]2.00 lakhs for every 100 weaver/worker). Additional margin money requirement, if any as per banking norms will be borne by the beneficiary Agency.

Margin money assistance to Primary Handloom Weavers' Co-operative Societies/Apex Handloom Weavers' Co-operative Societies/State Handloom Corporations will be provided on the recommendation of State Director of Handlooms.

Subsidized loans at concessional interest rate of 6% for a period of three years will be available to eligible handloom organizations only. However, this is subject to interest subvention cap only upto 7% by the Government of India.

Interest subvention as applicable will be provided maximum for 3 years from the date of first disbursal.

The eligible handloom organizations will be guaranteed by the National Credit Guarantee Trustee Company (NCGTC)/Credit Guarantee Fund Trust for Micro & Small Enterprises (CGTMSE), as per decision of the Bank/Financial Institution concerned. Guarantee cover will be effective from the date of disbursement of loan for 3 years.

Margin money assistance will be transferred directly to loan account of Handloom Organization.

The interest subsidy and credit guarantee fee will be transferred to the concerned bank.

Following agencies are eligible to avail loan from the Banks/Financial Institutions:

1. Handloom Weavers involved in weaving activity,
2. Weaver Entrepreneur,
3. Self Help Groups,
4. Joint Liability Groups,
5. Handloom organizations, including Primary Handloom Weavers' Co-operative Societies,
6. Apex Handloom Weavers' Co-operative Societies, State Handloom Corporations and
7. Producers' Companies/Consortia promoted by handloom weavers including those promoted under Cluster/Mega Cluster/Handloom Parks under SITP or other schemes of the Ministry of Textiles

Individual weaver who have already availed margin money assistance will not be eligible for financial assistance in terms of margin money assistance, interest subvention and credit guarantee fee under the strength of Handloom Organization, SHGs etc.

Fresh loan may be sanctioned after one year of re-payment of previous mudra loan to the handloom beneficiaries who availed loan in the past and have re-paid. Margin money will be available to all the beneficiaries, while interest subsidy and credit guarantee fee will be available to only Handloom Organizations.

Eligible beneficiaries are required to approach Participating Bank concerned along with required documents etc. for availing loan benefits under the scheme.