Weaver Mudra Scheme (WMS): Provide Business Loan to Handloom Weavers | NHDP.

The “National Handloom Development Programme: Weaver MUDRA Scheme (Concessional Credit)” is one of the National Handloom Development Program (NHDP) launched by the Ministry of Textiles, Government of India.

Weaver MUDRA Scheme

1. Weaver MUDRA Scheme offers financial assiatance to handloom weavers involved in weaving activity through a weaver’s credit card or term loan.
2. Financial assistance is provided for working capital, purchase of tools & equipment, and to make available the credit to identified handloom weavers.

Benefits

Margin Money Assistance:

1. Individual Handloom Weaver/Weaver Entrepreneur- Margin Money assistance at 20% of the loan amount, subject to a maximum of Rs.25,000/-.
2. Handloom organisation – Margin money assistance @ 20% of the loan amount, subject to a maximum of Rs.20.00 lakh (margin money @ Rs.2.00 lakh for every 100 weavers/workers). Additional margin money requirements, if any, as per banking norms, will be borne by the beneficiary agency.
3. 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 the State Directors of Handlooms.

Interest Subvention:

1. Subsidised loans at a concessional Interest rate of 6% for three years will be available to eligible handloom organisations only. However, this is subject to an interest subvention cap of only up to 7% by the Government of India.
2. Interest subvention as applicable will be provided for a maximum of 3 years from the date of first disbursal.

Credit Guarantee:

1. The loans extended to eligible handloom organisations will be guaranteed by the National Credit Guarantee Trustee Company (NCGTC)/Credit Guarantee Fund Trust for Micro & Small Enterprises (CGTMSE), as per the decision of the Bank/Financial Institutions concerned. Guarantee cover will be effective from the date of disbursement of the loan for 3 years.
2. If the loan amount sanctioned is Rs.1.00 crore, the handloom organization is eligible for maximum money assistance of Rs.20.00 lakhs (margin money @Rs.2.00 lakhs for every handloom weaver/worker). Therefore, a credit guarantee would be covered on the loan amount disbursed up to Rs.1.00 crore.
3. The credit guarantee fee on the loan amount disbursed would be borne by the GoI for 3 years.

Key Points

1. Under the scheme, the loans will be provided to all eligible handloom beneficiaries for 3 years.
2. Individual handloom weavers who have availed loans up to the issuance date of the guidelines will be eligible for the benefits of interest subsidy and credit guarantee fee up to 3 years from the date of first disbursal of the loan amount. These benefits will be discontinued thereafter for sanctioning fresh loans to individual weavers.
3. Loans extended by banks up to Rs 10.00 lakhs will be covered under MUDRA, and loans above.. 10.00 lakhs will be covered under Concessional Credit.
4. Margin money assistance to the Handloom Organisation will be provided on a pro-rata basis. The lower side of margin money assistance, i.e. @Rs.2.00 lakhs for every 100 waivers/workers or @20% of the loan amount sanctioned, subject to a maximum of Rs 20.00 lakhs, whichever is less, will be considered.
5. Margin money assistance will be transferred directly to the loan account of Handloom Organisation, while interest subsidy and credit guarantee fee will be transferred to the concerned bank.

Unit	Specifications
Principal	Hypothecation of assets such as raw material, finished goods, equipment, plant & machinery, created out of bank loan % margin.
Collateral	The loan must be covered under the Credit Guarantee Scheme of CGTMSE/CGFMU.
20% of Project Cost	Ministry of Textile (Govt. of India) to bear margin @ @20% of project cost with a maximum of Rs 25,000 balance margin money amount to be paid by the borrower.
Interest Subsidy	To provide loans at an interest rate of 6% to the handloom sector. Maximum interest subvention would be capped at 7%.

Eligibility

The agencies that are eligible to avail loans from Banks/Financial Institutions are as follows:

1. Handloom weavers are involved in weaving activity.
2. Weaver Entrepreneur.
3. Self-Help Groups.
4. Joint Liability Group.
5. Handloom Organisations, including Primary Handloom Weavers’ Co-operative Societies.
6. Apex Handloom Weavers’ Co-operative Societies, State Handloom Corporations.
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.

Exceptions

1. Individual weavers who have already availed of 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 Organisations, SHGS, etc.
2. A fresh loan may be sanctioned after one year of repayment of the previous Mudra loan to the handloom beneficiaries who availed a loan in the past and have repaid. Margin money will be available to all the beneficiaries, while interest subsidy and credit guarantee fees will be available to only Handloom Organisations.

Required Documents

1. Identity Card issued by the O/o DC (Handlooms).
2. Yarn Passbook.
3. An identity card issued by the State government.
4. Handloom Organisation- Registration Certificate, Balance Sheet, Profit & Loss Account, name of the weavers registered with the organisation, etc.

Also Read This: SRMS Loan: Self-Employment Schemes for Rehabilitation of Manual Scavengers | Government Scheme.

Application Process

To avail of the benefit of the Weaver MUDRA Loan, there is no online process available. You have to visit the authorised bank to do an application and verify the scheme’s benefits.

1. Approach the participating Bank concerned along with the required documents.
2. The applicants need to collect the application form from the bank.
3. In the application form, fill in all the mandatory fields and attach copies of all the mandatory documents.
4. Submit the duly filled and signed application form along with the documents to the bank.

Loan Disbursement 

1. A loan sanction letter will be issued by the bank to the applicant within one month of the application date.
2. Participating banks will sanction loans to the Handloom Organisations and have to lodge claims for disbursal of margin money assistance, interest subvention, and credit guarantee fee through the Handloom Weaver MUDRA Portal.
3. Intensive publicity will be carried out by the State Director of handlooms through newspapers, awareness camps, and by distributing pamphlets in Weaver’s pockets highlighting the benefits available under the scheme.

Participating Banks

1. All Scheduled Commercial Banks.
2. Regional Rural Banks.
3. State Co-operative Banks.
4. District Central Co-operative Banks.
5. Financial Institutions with the approval of the Competent Authority, the Ministry of Textiles, GoI.

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