National Rural Livelihood Mission (NRLM)
DEEN DAYAL ANTYODAYA YOJANA – NRLM
Ministry of Rural Development, Govt. of India has launched National Rural Livelihood Mission (NRLM) by restructuring Swarnajayanti Gram Swarozgar Yojana (SGSY), effective from April1, 2013.
Key Features of NRLM
- NRLM replaces SGSY w.e.f 1.4.2013
- Universal Social Mobilisation.
- ‘Participatory identification of the poor’
- Promotion of Institutions of poor
- Strengthening all existing SHGs and federations of the poor.
- Emphasis on Training, Capacity building and skill building.
- Revolving Fund and Community investment support Fund (CIF)
- Universal Financial Inclusion
- Provision of Interest Subvention
- Phased Implementation
- Intensive blocks
- Emphasis on repeat finance
NRLM – Key Difference from SGSY
- ‘Demand Driven’ Strategy – implementation in a Mission Mode
- Participatory identification of the Poor- preference for the poorest of the poor households
- SHGs based on Mutual Affinity
- NRLM has taken a Saturation Approach – will ensure all the poor in a village are covered
- Federations – Village level/Cluster level
- Continuous hand holding support to SHGs
- Access to Repeat Finance
- Availability of Revolving Fund
- Introduction of Interest Subvention
- No Collateral and no margin will be charged upto Rs. 10 lakh limit to SHGs
- No liens to marked against SB a/cs of SHGs
- No deposits to be insisted while sanctioning
- Allocation Based’ Strategy
- Identification based on BPL list
- SHGs based on common Activity
- One time financial Support
- Availability of Capital Subsidy
Financial Assistance to SHGs
- NRLM would provide Revolving Fund (RF)
1. SHGs with minimum of 3/6 months and following the norms i.e they follow ‘Panchsutra’.( regular- meetings, savings, internal lending, recoveries and maintenance of proper books of accounts.)
- Only SHGs that have not received RF earlier will be given RF now
- RF, as corpus, with a minimum of Rs. 10,000 and up to a maximum of Rs. 15,000 per SHG.
Capital subsidy has been discontinued under NRLM
No capital subsidy will be sanctioned to any SHG
Community Investment Support Fund (CIF)
- CIF will be provided to SHG in the intensive blocks
- Routed through the Village Level/Cluster level Federations
- To be maintained in perpetuity by the Federations.
- Federations will use CIF
1. to advance loans to the SHGs and/ or
2. to undertake the common/ collective socio-economic activities.
NRLM has a provision for interest subvention, to cover the difference between the Lending Rate of the banks and 7%, on all credit from the banks/financial institutions availed by women SHGs, for a maximum of Rs. 3 lakh per SHG.
This will be available across the country in two ways.
- In 150 identified district (3 in Gujarat Vadodara, Panchmahal & Banaskantha ), banks will lend to all the women SHGs @ 7% upto an aggregated loan amount of Rs. 3 lakh. The SHGs will also get additional interest subvention of 3% on prompt repayment, reducing the effective rate of interest to 4%
- In the remaining districts also, NRLM complaint women SHGs will be registered with SRLMs. These SHGs are eligible for interest subvention to the extent of difference between the lending rates and 7% for the loan up to Rs.3 lakhs, subject to norms prescribed by the respective SRLMs.
Role of Banks
Opening of Savings accounts for Women SHGs/ other SHGs
Follow Lending Norms:
- SHG should be in active existence at least since the last 6 months
- SHG should have Regular meetings; Regular Savings; Regular inter-loading; Timely repayment; and Up-to-date books of accounts.
- Qualified as per grading norms.
- Existing defunct SHGs are also eligible for credit if they are revived and continue to be active for a minimum period of 3 months.
Emphasis is given on multiple doses of assistance. Assisting an SHG over a period of time through repeat doses of credit to enable them to access higher amount of credit for taking up sustainable livelihood and to improve on the quality of life.
- First dose: 4-8 times of proposed corpus during year or Rs. 50,000 which is higher.
- Second dose: 5-10 times of existing corpus and proposed saving during next 12 months or Rs. 1 lakhs, which is higher.
- Third dose: Min Rs. 2 lakhs, based on Micro credit plan prepared by SHGs
- IV onwards: Loan amount can be between Rs. 5-10 lakhs for fourth dose. The loan will be based on micro Credit Plans of the SHGs.
Type of facility & repayment
- SHGs can avail either Term loan or a CCL loan of both based on the need.
- Repayment: The first dose of loan will be repaid in 6-12 instalments.
- II does: will be repaid in 12-24 months.
- III dose: the repayment has to be either monthly/ quarterly / half yearly based on cash flow and between 2 to 5 years.
- IV onwards: repayment has to be either monthly / quarterly/ half yearly based on the cash flow and between 3 to 6 years.
Security and Margin
- No collateral and no margin will be charged upto Rs. 10.00 lakhs limit to the SHGs.
- No lien should be marked against savings bank account of SHGs and no deposits should be insisted while sanctioning loans.
Post credit follow-up
- Loan pass books in regional languages may be issued to the SHGs with details and terms and conditions.
- At the time of documentation / disbursement of loan, clearly explain the terms and conditions as part of financial literacy.
- Observe one fixed day in a fortnight to enable interaction with SHGs & Federations
- Banks may take steps to achieve good recovery performance.
- Banks may furnish the recovery status in the BLBC, DLCC meetings.
- NRLM staff at the district / block level will assist the bankers in initiating the repayment.
- Non –willful defaulters should not be debarred from receiving the loan. In case of defaults due to genuine reasons, Banks may follow the norms suggested for restructuring the account with revised repayment schedule.
- The DCC ( NRLM sub -committee) shall regularly monitor the flow of credit to SHGs at the district level and resolve issues that constrain the flow of credit to the SHGs.
- At block level, BLBC shall meet regularly and take up issues of SHG bank linkage.
Reporting to LDMs
- The branches may furnish monthly progress report and delinquency report for NRLM to the LDM for onward submission to SLBC.
- Existing procedure of LBR returns to be continued duly furnishing correct code.
- Each bank to assign following codes to all accounts of SHGs.
1. Unique code for Women SHGs- Assign gender based codes for SHGs- Male, Female as well as mixed irrespective of promoting agencies.
2. Unique code for NRLM – For both S/B and loan accounts of women SHGs.
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