Access to Credit in Powerloom Sector: An Update
While explaining the Government of India’s initiatives for powerloom sector, Union Minister of Textiles, Smriti Zubin Irani, informed the Rajya Sabha that Ministry of Textiles is implementing Pradhan Mantri Credit Scheme for Powerloom Weavers under PowerTex India from 01.04.2017 to 31.03.2020. The scheme provides adequate and timely financial assistance to the power loom weavers to meet their credit requirements for investment needs (term loan) in a flexible and cost-effective manner. There are two components in the Scheme – Prime Minister MUDRA Yojana (PMMY) and Stand-up India Scheme. The details are as under:
(i) Under MUDRA
- Existing individual power loom units (or) new individual/group enterprises involved in weaving activity are eligible.
- Margin money at 20% of machinery cost with a ceiling of Rs.1.00 lakh and
- Interest Subvention at 6% per year for 5 years.
- Under Stand-up India (SC/ST/Woman – who are new entrepreneurs)
- New Powerloom units established by a person who belongs to SC/ST/Woman Entrepreneur.
- In case of non-individual units at least 51 % of the share holding and controlling stake should be held by either an SC (or) ST (or) Women entrepreneur.
- 25% Margin Money (Max. Rs.25 lakhs) on the machinery cost, the borrower is required to bring in 10% of the Project Cost as his/her own contribution.
The scheme is effective from 01.04.2017 with an approved outlay of Rs. 11.92 crores for a period of 3 years and it is operating and implementing on Pan India basis. Under this new scheme, applications received through banks are under scrutiny. Textile Commissioner Office, Mumbai has received 4 applications from banks out of which 1 was found eligible as per guidelines and in remaining clarification from banks are sought. For one eligible application, release of Rs.22.90 lakh is under process.