Interest subvention scheme for women SHGs under DAY-NRLM

Women Self Help Group (SHG) under DAY-NRLM is a group voluntarily formed by 10-15 women. The special SHG can be formed with 5 persons in the difficult area, remote area, or groups with disabled persons, consisting minimum of 5 persons. The other persons with disabilities, the elders, and trans-genders can only form SHG with both men and women under DAY-NRLM. There is no need to register the SHGs under any act.

The interest subvention scheme is limited to Women Self Help Groups under DAY-NRLM in rural areas only. Under the scheme, banks will extend credit at a concessional interest rate of 7% per annum for loans up to Rs.3 lakh.

For loans above Rs.3 lakhs and up to s.5 lakh under the scheme, banks will extend credit at an interest rate equivalent to their 1 year MCLR. Above 5 lakhs, for Grade A, the Applicable ROI is MCLR +1.25% and for Grade B, the Applicable ROI is MCLR +2%.

Women SHGs promoted by other agencies and following the DAY-NRLM protocols will also be eligible for the benefit of subvented loans subject to prior submission of the details of such SHGs on the DAY-NRLM SHG database.

To avail the interest subvention on credit extended to the women SHGs, banks need to ensure that the accounts of SHGs (both savings and loans) under DAY-NRLM are appropriately identified in their CBS with unique codes assigned by DAY-NRLM/SLRMs.

Difference between SGSY (DAY-NRLM) and SHG:

Swarnajayanti Gram Swarozgar Yojana (SGSY)/DAY-NRLM is a government program that provides income-generating assets to poor families in rural areas, while Self-Help Groups (SHGs) are informal groups of people who work together to improve their living conditions

All banks participating in the interest subvention scheme are required to upload information on the SHG savings and loan account, etc. on the respective Nodal Bank/ Nodal Agency portal as per the required technical specifications provided.

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