Main Schemes of SIDBINational Equity Fund Scheme which provides equity support to small entrepreneurs setting up projects in Tiny Sector. Technology Development & Modernisation Fund Scheme for providing finance to existing SSI units for technology upgradation/modernisation. Single Window Scheme to provide both term loan for fixed assets and loan for working capital capital through the same agency. Composite Loan Scheme for equipment and/or working capital and also for worksheds to artisans, village and cottage industries in Tiny Sector. Mahila Udyam Nidhi (MUN) Scheme provides equity support to women entrepreneurs for setting up projects in Tiny Sector. Scheme for financing activities relating to marketing of SSI products which provides assistance for undertaking various marketing related activities such as marketing research, R&D, product upgradation, participation in trade fairs and exhibitions, advertising branding, establishing distribution networks including show room, retail outlet, wears-housing facility, etc. Equipment Finance Scheme for acquisition of machinery/equipment including Diesel Generator Sets which are not related to any specific project. Venture Capital Scheme to encourage SSI ventures/sub- contracting units to acquire capital equipment, as also requisite technology for building up of export capabilities/import substitution including cost of total quality management and acquisition of ISO-9000 certification and for expansion of capacity. ISO 9000 Scheme to meet the expenses on consultancy, documentation, audit, certification fee, equipment and calibrating instruments required for obtaining ISO 9000 certification. Micro Credit Scheme to meet the requirement of well managed Voluntary Agencies that are in existence for at least 5 years; have a good track record and have established network and experience in small savings-cum-credit programmes with Self Help Groups (SHGs) individuals.

Major schemes

1. Technology Development & Modernisation Fund

SIDBI has set up Technology Development & Modernisation Fund (TDMF) scheme for direct assistance of small sale industries to encourage existing industrial units in the sector, to modernise their production facilities and adopt improved and updated technology so as to strengthen their export capabilities. Assistance under the scheme is available for meeting the expenditure on purchase of capital equipment acquisition of technical know-how, upgradation of process technology and  products with thrust on quality improvement, improvement in packaging and cost of TQM and acquisition of ISO-9000 series certification.

SIDBI in July 1996 had permitted SFCs and promotional banks to grant loans for modernisation projects costing upto Rs. 50 lakhs. The Coverage of the TDMF scheme has been enlarged w.e.f. 1.9.1997. Non-exporting units and units which are graduating out of SSI sector are now eligible to avail assistance under this scheme.  

2. National Equity Fund

National Equity Fund (NEF) under Small Industries Development Bank of India (SIDBI) provides equity type assistance to SSI units, tiny units at five per cent service charges. The scope of this scheme was widened in 2000-01 raising the limit of loan from Rs. 6.25 lakhs to Rs. 10 lakhs and project cost limit from Rs. 25 lakhs to Rs. 50 lakhs.

(a) The following are eligible for assistance under the scheme:-  

i. New projects in tiny and small scale sectors for manufacture, preservation or processing of goods irrespective of the location (except for the units in Metropolitan areas).

ii. Existing tiny and small scale industrial units and service enterprises as mentioned above (including those which have availed of NEF assistance earlier), undertaking expansion, modernisation, technology upgradation and diversification irrespective of location (except in Metropolitan areas).

iii. Sick units in the tiny and small scale sectors including service enterprises as mentioned above, which are considered potentially viable, irrespective of the location of the units (except for the units in Metropolitan areas).

iv. All industrial activities and service activities (except Road Transport Operators).

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(b) Project cost (including margin money for working capital) should not exceed Rs. 50 lakhs in the case of new projects in the case of existing units and service enterprises, the outlay on expansion/modernisation/technology upgradation or diversification or rehabilitation should not exceed Rs. 50 lakhs per project.

(c) There is no change in the existing level of promoters' contribution at 10% of the project cost. However, the ceiling on soft loan assistance under the Scheme has been enhanced from the present level of 15% lakh per project to 25% of the project cost subject to a maximum of Rs. 10 lakhs per project.

(d) 30% of the investment is earmarked for tiny units.

Single Window Scheme (SWS)

Purpose

To provide both term loan for fixed assets and loan for working capital through a single agency. The total working capital requirement of such units inclusive of all fund based facilities are to be taken into account for determining the working capital facility eligible for refinance

Eligible Borrowers

Entrepreneurs setting up new projects in MSE / tiny sector, new promoters acquiring unencumbered fixed assets of existing MSE concerns from PLIs and also existing well run units undertaking modernisation / technology upgradation and potentially viable sick units undertaking rehabilitation scheme

Norms

Scheme operated through SFCs / twin function IDCs / scheduled commercial banks / eligible state co-operative banks / scheduled urban co-operative banksLoan Limit - Not to exceed Rs.200.00 lakh

Rehabilitation Of Sick Industrial Units

Purpose

For providing assistance for rehabilitation of potentially viable sick units

Eligible Borrowers

Potentially viable MSE units including units in cottage and village industries and in tiny sector, conforming to definition of sick MSE unit as prescribed in guidelines of Reserve Bank of India. The assistance is meant for sick MSE units for which proper rehabilitation packages have been drawn up. Units eligible for rehabilitation assistance should be capable of being restored to normal health within a reasonable time.

PurposeTo provide both term loan for fixed assets and loan for working capital through the same agency. The total working capital requirement of such units inclusive of all fund based facilities may be taken into account for determining the working capital facility eligible for refinance

Eligible Borrowers

Entrepreneurs setting up new projects in SSI / tiny sector, new promoters acquiring unencumbered fixed assets of existing SSI concerns from PLIs, as also existing well run units undertaking modernisation / technology upgradation and potentially viable sick units undertaking rehabilitation scheme

Norms Scheme operated through SFCs / twin function IDCs / scheduled commercial banks / eligible state co-operative banks / scheduled urban co-operative

banks

Term Loan - Not to exceed Rs.20 millionMahila Udyam Nidhi Scheme

This scheme aims to provide soft loan (Quasi equity) assistance to women entrepreneurs besides usual term loans for setting up industrial units in the small scale and tiny sector, as also for undertaking service activities eligible for assistance under the SIDBI refinance scheme.

  Eligibility

New projects in tiny and small-scale sectors for manufacture, preservation or processing of goods (Tiny enterprises would include all industrial units and services industries (except Road Transport Operators) satisfying the investment ceiling.Existing tiny and small scale industrial units and service enterprises as mentioned above (including those which have availed of this loan earlier) for undertaking expansion, modernisation, technology upgradation and diversification.Sick units in the tiny and small-scale sectors including service enterprises as mentioned above, which are considered potentially viable.All industrial activities and service activities (except Road Transport Operators) in the SSI sector.Projects which avail of any margin money or seed/special capital assistance under the schemes of Central/State Governments, State Financial Corporation and other state level institutions or banks (except State investment subsidy) are not eligible for assistance under the scheme.

  Project Outlay

Project cost (including margin money for working capital) should not exceed Rs.10.00 lakh in case of new projects. In the case of existing units and service enterprises, the outlay on expansion/modernisation/technology upgradation, or diversification or rehabilitation should not exceed Rs.10.00 lakh per project.

  Amount of soft loan

Soft loan up to 25% of the project cost with a ceiling of Rs.2.50 lakh per project to meet the gap in equity as per prescribed Debt Equity Ratio (DER) of 1.857:1 (excluding State subsidy which may be retained for meeting working capital) after taking into account the promotors' own contribution equivalent to 10% of the project cost. In addition, term loan may be sanctioned as per usual norms under Refinance Scheme of SIDBI.

  Security

Hypothecation of the articles purchased. 3rd party guarantee acceptable to the bank. No security including collateral security will be insisted upon from borrowers in respect of soft loan.

  Rate of Interest

1. Soft loan: Only service charge @ 1% p.a. is payable, which may be retained by lending office.

2. Term Loan: As per interest rates advised from time to time or structure under Refinance Scheme as fixed by SIDBI from time to time, in case refinance has been availed. For such prevailing rates, the concerned branch may be contacted.

  Repayment

Soft loan is repayable within 10 years (inclusive of initial moratorium period of not more than five years). However, the period of repayment of soft loan will be co-terminus with that of term loan.

Extent of Refinance/Reimbursement of the Soft Loan

Term Loan: As provided under the Refinance Scheme.

Soft Loan: Soft Loan is reimbursed to the extent of 100%.

  Disbursement

Soft loan is to be released in accordance with terms and conditions of sanction thereof and after the promoter(s) has (have) brought in her (their) own contribution in full.Bank has to act as agent of SIDBI for sanction, disbursement and recovery of soft loan.

Mahila Udham Nidhi Scheme

Q. Who can avail loan under Mahila Udyam Nidhi Scheme from your Bank? A. Entrepreneurs engaged in new projects in tiny and small scale sectors for manufacture, preservation or processing of goods ((tiny enterprises would include all industrial units and services industries (except Road Transport Operators) satisfying the investment ceiling prescribed for tiny enterprises viz. Rs. 5 lakh). Apart from this, all tiny and small scale industry entrepreneurs (including those who have availed this facility earlier) are also eligible for undertaking expansion, modernisation, technology upgradation and diversification. Sick units in the tiny and small scale sectors including service enterprises as mentioned above, which are considered potentially viable, besides all industrial activities and service activities (except Road Transport Operators) in the SSI sector, are also eligible for loan under this scheme.

Q. What are the criteria for project outlay for financing under this scheme?A. The project cost criterion (including margin money for working capital) is as under: q for new projects: not exceeding Rs.10.00 lakh per project. q for existing units and service enterprises: the outlay on expansion/modernisation/technology upgradation, or diversification or rehabilitation should not be exceeding Rs.10.00 lakh per project.

Q. How is the soft loan portion disbursed?A. The soft loan is to be disbursed in accordance with terms and conditions of

sanction and only after the promoter(s) has (have) brought in her (their) own contribution in full. In this connection, the bank acts as agent of SIDBI for sanction, disbursement and recovery of soft loan.

Q. What will be the soft loan amount? A. A soft loan under this scheme can be sanctioned up to 25% of the project cost with a ceiling of Rs.2.50 lakh per project to meet the gap in equity as per prescribed Debt Equity Ratio (DER) of 1.857:1 (excluding State subsidy which may be retained for meeting working capital), after taking into account the promoters' own contribution equivalent to 10% of the project cost. In addition, term loan may be sanctioned as per usual norms under Refinance Scheme of SIDBI.

Q. What will be the repayment period of the soft loan?A. The soft loan is repayable within 10 years (inclusive of initial moratorium period of not more than five years). However, the period of repayment of soft loan will be co-terminus with that of term loan.

Q. What are the rate(s) of Interest charged for the soft loan and the term loan respectively? A. In case of the soft loan, only service charge @ 1% p.a. is payable, which may be retained by lending office. As for the term loan, the interest rates will be as advised from time to time OR structure under the Refinance Scheme as fixed by SIDBI from time to time, in case refinance has been availed.

Q. What is the extent of Refinance/reimbursement of the soft loan that can be availed under this scheme? A. The term loan under the scheme will be provided as given under the Refinance Scheme. The Soft Loan, on the other hand, will be reimbursed to the extent of 100%.

ASSISTANCE TO DISABLED ENTREPRENEURS

Guidelines for Funding Projects:

The ‘National Handicapped Finance and Development Corporation’ has been incorporated by Ministry of Social Justice and Empowerment, Government of India on 24th January, 1997 under section 25 of the companies Act., 1956 as a company not for profit. It is wholly owned by Government of India and has an authorised share capital of Rs.400 crores (Rupees Four Hundred crores only).

Objectives:

1. Promote economic development activities for the benefit of the persons with disabilities.2. Promote self-employment and other ventures for the benefit/economic rehabilitation of

the persons with disabilities.3. Assist individuals with disabilities or group of individuals with disabilities by way of loans

and advances for economically and financially viable schemes and projects.4. Grant concessional finance in selected cases for the persons with disability in the country

in collaboration with Government Ministries/Departments at State level to the extent of the budgetary assistance granted by the Government of India to the company.

5. Extend loans to the persons with disability for pursuing general/professional/technical education for training at graduate and higher levels.

6. Assist in the upgradation of technical and entrepreneurial skills of persons with disability for proper and efficient management of production units.

7. Set up training, quality control, process development, technology, common facility centers and other infrastructural activities for the proper rehabilitation/upliftment of the handicapped persons in support of their economic pursuits.

8. Assist the State level organisations to deal with the development of the persons with disability by way of providing financial assistance and in obtaining commercial funding or by way or refinancing.

9. Work as an apex institution for channelising the funds through State Finance Corporation for the Handicapped or through corresponding Corporations authoriesed by State Govts./Boards set up by Union Government/State Government/Union Territory Administrations and Voluntary Organisations. The NHFDC will receive proposals for financial assistance through above mentioned organizations and sanction loans and margin money to the beneficiaries for disbursement through these organizations.

10. Assist self-employed individuals/group of individuals or registered factories/companies/cooperatives of disabled persons in marketing their finished goods and assist in procurement of raw materials.

11. To develop, operate and implement specific pilot programmes, projects and schemes in India in support of promotion of the self employment, economic activities of the handicapped persons with a view of introducing innovations, technological up-gradation and bridging the critical gaps of infrastructure, input supply, output processing and marketing.

12. To undertake and/or support technically, managerially or financially research and evaluation studies, techno-economic and related surveys, preparation and appraisal of project reports and documents, feasibility and other studies for developing viable programmes, projects, schemes for the benefit of handicapped.

13. To establish, maintain, subscribe or to subsidise or become member of training institutions, research laboratories research institutions and experimental experiments.

Scheme for Financing Projects:

The corporation can assist a wide range of income regenerating activities. Infrastructure development schemes alone will not qualify for financing unless it leads directly to income generation.

For a disabled person living below the income/economic criteria, the proposals should be such which generate adequate income to the disabled person to rise above the economic criteria limit.

1. Self employment in Small Business e.g. Service/Trading sector:

Loan will be provided for self employment of disabled persons in service sector or for trading activity. The Small Business, project or activity for which financial assistance has been sought, will have to be operated by the disabled person himself and employing at least 15 % disabled persons in his venture.

Maximum loan available under this scheme is Rs.2.50 lakh.

Indicative areas of financing are:

1. Shops or Stores of any type2. Workshops or repair shops or service centres3. Health centre/Beauty parlour4. Computer centre (training & job work)5. Studio/Photography6. Printing press7. Telephone/Fax/Email booth8. Tailoring9. Travel agency10. Xerox centre11. Transport service12. Poultry farming13. Handicraft14. Brassware15. Dealership16. Franchise17. School for disabled18. Weaving19. Book Binding20. Leather work21. Physiotherapy22. Music schools23. Computer hardware Dealership24. Dealership of petroleum products25. Candle and chalk making

2. Assistance to Disabled Entrepreneurs:

Loan may be provided for manufacturing, fabrication and production activity. The disabled person will be the owner/chief executive of the company and employing at least 15% disabled persons.

Maximum amount of loan provided under the scheme is Rs.20.00 lakh.

Illustrative list is given below:

1. Ancillary products manufacturing2. Software development and marketing3. Fisheries4. Dairy farming5. Diamond cutting and polishing6. Food processing7. Garments Manufacturing8. Potteries9. Furniture manufacturing including moulded furniture10. Plastic moulding11. Agro based industry12. Herbal products13. Packaging

Any other suitable manufacturing/processing activity besides above:

3. Assistance to Disabled for Higher Studies or Professional Training:

Towards the fulfillment of the overall objectives of empowerment and development of disabled persons in the country, the Corporation provides financial assistance to eligible beneficiaries in two components viz., educational /training grants and loans (In pursuance of objective (5) & (6) of MOA).

Financial assistance from the corporation would flow towards training and Education requirements of the disabled groups under both formal and non-formal education/training, which would impart useful knowledge and skill. Formal training would equip the beneficiary to improve his/her chances of employment and self-employment through completing appropriate vocational/academic courses leading to the certificate /diploma or other qualification. While higher education (under graduate, post-graduate and doctoral studies) applications would be considered for loan whereas applications for technical education/ training leading to diplomas and certificates will be considered as grants, which would meet the beneficiary's expenses towards both tuition fees and hostel facilities provided no other financial assistance or concession(s) is available from any other source for this purpose.

Channelising Agencies are required to furnish lists of recognised institutions identified for imparting training in these areas, which will be approved by the Corporation.

Additionally, technical training including non-formal training wherever required will not form part of the project and the expenditure incurred therein will not form

part of a loan.

4. Assistance for Agricultural Activities:

Loan assistance is provided to disabled persons for:

1. Agriculture production and related field such as irrigation, purchase of agriculture machinery, horticulture, sericulture etc.

2. Purchase of equipment for agriculture services such as custom service (pesticide, spray, harvesting etc.) custom hiring of agriculture machinery.

3. Agriculture marketing (through co-operative societies/Association of disabled farmers), Setting up grading and packing houses, purchase of transport vehicles for marketing of agriculture produce etc.

4. Purchase of land for agriculture purpose by individual disabled person or by co-operative societies of disabled persons.

5. Commission agents at Mandi Samities.6. Small business such as retail outlets for marketing Organic fertilizers,

Pesticides/insecticides. Improved variety of seeds, farm machinery etc. Maximum loan available under this scheme is Rs.5.00 lakh.

5. Scheme to Promote Manufacturing/Production of Assistive Devices for Disabled persons:

Loan Assistance is provided for setting up small scale industry for manufacturing aids and appliances developed under R & D programmes of Government/academic institutions of repute for disabled within the country. The company should employ disabled persons.

Maximum loan available under this scheme is Rs.25.00 lakh.

6. Assistance for Skills & Entrepreneurial Development Programmes:

1. Financial assistance in the form of loan is provided to the channelising agencies, reputed NGO's, RRTC's and recognised technical institutions for imparting skills and entrepreneurial development training to disabled persons.Financial assistance is also provided for setting up vocational training centres including computer training centre, exclusively for imparting skills and entrepreneurial development training to disabled persons.

2. The proposals for loan should necessarily indicate placement/self employment opportunities to the disabled after training.

3. Financial assistance in the form of loan will also be available for upgradation of skills of disabled workers and entrepreneurs who have set up units with the financial assistance from NHFDC.

7. Scheme to Promote Self Employment amongst Persons with Mental Retardation, Cerebral Palsy and Autism:

Persons with mental retardation, cerebral palsy or autism may not be eligible to seek loan and enter into a legal contract. In such cases following categories of persons are eligible for financial assistance from NHFDC.

1. Parents of dependant mentally retarded persons.2. Spouse of dependant mentally retarded persons.

Persons seeking loan from NHFDC under this category should encourage self employment of the mentally retarded persons. Projects should be identified in such a way that there is direct involvement and participation of the beneficiary in the project.

Indicative areas for financing are:

3. Shop or store4. Assembling unit5. Workshop or repair shop6. Envelop making unit7. Pickle, papad, wadi making unit8. Home unit for making squash, jam etc.9. Bakery10. Xerox Centre11. Tailoring unit12. DTP Centre13. Screen Printing14. Poultry15. Dairy Farming16. Horticulture17. Handloom Unit18. Block, textile printing

Maximum loan available under this scheme is Rs.2.50 lakhs

Eligibility Criteria

Criteria of Disability

The beneficiary should be a disabled person or a cooperative society of disabled persons or a legally constituted association of disabled persons or a firm promoted by disabled persons unless otherwise mentioned in the scheme for financing.

In order to be eligible for loans on concessional interest rates from the Corporation, minimum degree of disability shall not be less than 40 percent.

A person with disability means a person:

1. Who is blind or2. Who is a person with low vision, or3. Who is speech and hearing handicapped, or4. Who has a locomotor disability on account of orthopedic or neurological impairment

(including cerebral palsy) or5. Who is mentally retarded, or6. Who is multiple handicapped, and includes any persons who is unable to ensure by

himself/herself, wholly or partly, the necessities or a normal individual or social life including work as a result of deficiency, whether congenital or not, in his/her physical or mental capabilities.

Explanation for the purpose of the disabilities mentioned above:

1. a person shall be deemed to be blind if he suffers from either of the following conditions, namely:

1. total absence of sight, or2. visual acuity not exceeding 6/60 or 20/200 (snellen in the better eye with

correcting lenses ) or3. limitation of field of vision subtending an angle of 20 degree or worse.

2. a person with low vision is one who has impairment of visual functioning even after treatment and/ or standard refractive correction, but who uses, or is potentially able to use vision for the planning or execution of a task with appropriate assistive device.

3. a person shall be deemed to be deaf if he/she has lost sixty decibels or more in the better ear in the conversational range or frequencies.

4. a person shall be deemed to have locomotor disability if he is having disability of the bones, joints or muscles leading to substantial restriction of the movement of the limbs or if has any form of cerebral palsy.

5. mental retardation refers to sub-average general intellectual functioning, which originates during the development period and is associated with impairment in a adaptive behaviour.

6. mentally ill person shall have the same meaning as assigned to the word in para (i), Section 2, Chapter I of Mental Health Act. 1987.

7. Leprosy-cured persons mean and included leprosy cured persons –1. with loss of sensation in hands or feet as well as of sensation and paresis in the

eye and eye lid but with no manifest deformity;2. with manifest deformity and paresis but having sufficient mobility in their hands

and feet to enable them to engage in normal economic activity;3. suffering from extreme physical deformity as well as advanced age which

prevents them from re-entering into any economic activity;8. multiple handicapped means and includes a person with more than one disability.

Economic/Income Criteria

Unemployed disabled persons whose family income is below Rs.22,000/- p.a. for rural areas and Rs.24,000/- p.a for urban areas (two times of poverty line) are eligible for availing loan facility. (Family means parents or spouse of dependent disabled)

In case of self dependent disabled, the income of the individual will only be taken into account.

The economic criteria will also be applicable to each member of a cooperative society of disabled persons, association of disabled persons and firm promoted by disabled persons seeking financial assistance from NHFDC.

Minimum age limit for availing loan is 18 years and maximum age is 55 years. However, the maximum age could be relaxed in the case of professionally, qualified entrepreneurs.

The sanctioned loan amount and repayment period will depend on the age of applicant.

Other Requirements

The applicant:

1. should be an Indian citizen;2. should be domicile of the state where the project is proposed to be put up;3. should have relevant educational/technical/vocational

qualification/experience/background;4. should not have any large outstanding debt from other organisation and should not be

financial defaulter;5. should be from agriculture background and project location should be in agriculture area

if seeking loan under the scheme ‘ Assistance for Agricultural Activities’.

Types of Funding:

NHFDC can consider following types-of loans;

1. Term Loan

The Corporation can consider grant of Term Loan to a disabled entrepreneur or group of disabled entrepreneurs through the channelising agency.

Under Term Loan Scheme, loans are given upto 100% of project cost as follows:

For the project with high working capital component, quantum of loan will depend upon the total cost of the project as follow:

1. Where the total cost of the scheme does not exceed Rs.50,000 the scheme will be treated as a composite loan and no distinction will be made between fixed asset and working capital. In such cases loans can be granted upto 100% of the total cost.

2. Where the unit cost of the project is more than Rs.50,000 but does not exceed Rs.1,00,000 the ratio of fixed assets to working capital will not exceed 1:3.

3. Where the unit cost of the scheme exceed Rs.1.00 lakh, only 50% of the working capital requirement will be added in the project cost as working capital margin to arrive at the unit cost of the project, remaining amount of the working capital will have to be financed by the banks as cash credit limit.

In order to cover maximum number of beneficiaries, 75% of the amount of term loans sanctioned in any financial year to a Channelising Agency shall be for those projects where NHFDC loan component is below Rs.1,00,000 per unit.

Details of the Projects

Project CostNHFDC Share

Channelising Agency share

Promotor's share

Below Rs.50,000 100% Nil Nil

Above Rs.50,000 and upto 1.00 lakh

95% 5% Nil

Above Rs.1.00 lakh and upto Rs.5.00 lakhs

90% 5% 5%

Above 5.00 lakhs 85% 5% 10%

2. Margin Money Loan (Seed Capital)1. Seed Capital assistance is provided to entrepreneurs availing term loan from

State Financial Corporation (SFCs) / other financial institution but not able to bring in their share of equity stipulated by the term lending institutions.

2. Seed Capital assistance is to meet the gap in the equity stipulated by the term lending institutions as per their norm of debit equity ratio.

3. The entrepreneur is to bring in a minimum of 20% of the equity.4. NHFDC may provide Seed Capital assistance upto 80% equity required to be

funded by the beneficiary for the total project cost upto Rs.50 lakhs.5. Seed Capital assistance is free of interest but the channelising agencies will levy a

service charge of 1% p.a from the beneficiaries and pay 0.5% p.a to NHFDC.6. Seed Capital is to be repaid within a maximum period of 7 years from the date of

first disbursement, inclusive of suitable moratorium. In cases where seed Capital assistance remains unpaid beyond 7 years, the same shall be converted in to

term loan at the expiry of 7th year at an interest applicable to NHFDC term loan and shall be paid within 3 years in quarterly instalments from the date of conversion into term loan. The Margin Money Loan may be recovered from the beneficiary alongwith bank loan in the same proportion, which the Margin Money bears to the bank loan. Based on such recoveries the Channelising Agency or other agency will make the repayment schedule of margin money.

7. Projects considered for Seed Capital assistance shall not be eligible for any other financial assistance from NHFDC

Rate of Interest

Loan AmountInterest by

NHFDCInterest (Channelising

Agency)Total

Loan amount less than Rs.50,000 3% 2% 5%

Loan amount above Rs.50,000 and upto Rs.1,00,000

4% 2% 6%

Loan amount above Rs.1,00,000 and upto 5,00,000

7% 2% 9%

Loan amount above Rs.5,00,000 8% 2% 10%

8. For women with disability, a rebate of 2% on interest is provided. A rebate of 0.5% on interest is provided for timely repayment of loan.

Allocation of Available Fund for Disbursement

1. In order to cover maximum number of beneficiaries, 75% of available fund is earmarked for those projects where NHFDC loan is below 1.0 lakh.

2. In order to ensure economic empowerment of disabled women and to ensure general balance, channelising agencies are to be given due weightage to women applicants and special efforts should be made to attract projects form women.

Sanction of Loan

1. Loan will be sanctioned by channelising agency for final disbursement to beneficiary with prior approval of NHFDC. The channelising agency will send all applications for loan duly recommended for approval of NHFDC.

2. For loan under scheme(5) production of assistive devices and scheme (6) assistance for skill & entrepreneurial development, application will be received and appraised by NHFDC directly. The loan will be sanctioned and disbursed by NHFDC.

3. Board of Directors of NHFDC will sanction all projects with loan component exceeding

Rs.10 lakhs.

Recovery of Loan

1. The entire loan shall be repaid within a reasonable period but not exceeding 7 years including the moratorium period. The repayment shall be on half yearly/ quarterly/monthly basis. For agriculture and horticulture projects repayment shall be on yearly basis. The repayment period will be worked out during appraisal and sanction of scheme on the basis of income potential of the proposed project.

2. A suitable moratorium period depending on the merit and requirement of the project will be allowed.

3. A rebate of 0.5% on interest is provided for timely payment of all instalment.4. A penal interest of 3% will be charged from channelising agency for default in timely

repayment. The channelising agency will also charge panel interest of 3% from the beneficiary for default in repayment.

Security

1. Block Government guarantee is required from concerned State Government for the sanction and disbursement of loan by NHFDC to State Channelisng Agencies. In case of persistent default, the NHFDC will be at liberty to invoke the guarantees or deduct its instalments from the future projects of the concerned agency to be financed.

2. NHFDC may also accept Bank Guarantee or any other form of security acceptable to it for grant of loans.

For Application Form for Financial Assistance and Further Details Please Contact:

National Handicapped Finance and Development Corporation(Ministry of Social Justice and Empowerment, Government of India)Red Cross Bhavan, (opp. Mini Secretariat)Sector – 12, Faridabad – 121 007 (Haryana)

National Handicapped Finance and Development Corporation (NHFDC)Schemes of NHFDC

The corporation provides financial assistance for wide range of income generating activities to disabled persons. These are:

i. For setting up small business in Service / Trading sector : Loan up to Rs. 3.0 lakh for sales / trading activity and Rs. 5.0 lakh for service sector activity

ii. For purchase of vehicle including auto rikshaw for commercial hiring: Loan upto Rs. 10 lakh.

iii. For setting up small industrial unit: Loan upto Rs. 25 lakh. Loan assistance is provided to disabled persons for manufacturing, fabrication and production.

iv. For Agricultural activities: Loan upto Rs. 10 lakh Loan assistance is provided to disabled persons for agricultural production, irrigation, horticulture, sericulture, purchase of agricultural machinery / equipment for agricultural services, marketing of agricultural products etc.

v. For self-employment amongst persons with mental retardation, cerebral palsy and autism: Loan upto Rs. 5 lakh, In such cases, the financial assistance is extended through parents or spouse or legal guardian of the dependant mentally disabled person.

vi. Loan for Professional / Educational / Training courses: Loan upto Rs. 7.50 lakh for studies in India and upto Rs. 15 lakh for studies abroad.

vii. Micro Credit Scheme by State Channelising Agencies implemented through NGOs. - Loan upto Rs 5 lakh for each NGO and Rs. 25,000/- for each beneficiary.

viii. Parents' Association of mentally retarded persons - Loan upto Rs. 5 lakhix. Financial Assistance for Skills & Entrepreneurial Development (in the form of grant to

channelising agencies/reputed training institutions for imparting skills and entrepreneurial development training to disabled persons)

Eligibility Criteria for availing credit

Any Indian Citizen with 40% or more disability. Age between 18 and 60 years. Annual income below Rs.5,00,000/- (Rupees Five Lakh only) per annum for urban areas

and Rs.3,00,000/- (Rupees Three Lakh only) per annum for rural areas. Relevant educational / technical / vocational qualification / experience and background.

Rates of InterestSl. No. Loan Amount Rate of Interest (Per Annum)

1. Upto Rs.50,000/- 5%

2. Above Rs. 50,000/- and upto Rs. 5 lakh 6%

3. Above Rs. 5.0 lakh 8%

Repayment

General scheme of financing: within 10 years, Education loan-within 7 years (after 6 months from the date of completion of course or after getting the job, whichever is earlier), Micro Credit Loan: within 3 years.

Rebate

A special rebate of 1% on interest is given to women with disabilities in all the schemes of

NHFDC.

Procedure for obtaining loan

Applications on prescribed format to be submitted through the State Channelising Agencies (SCAs) of NHFDC. The address of SCAs are given in Annexure-I (-1 ) (PDF file that opens in a new window).

(For further details, log on to NHFDC website: www.nhfdc.org (External website that opens in a new window))