1

Objectives

v      To provide adequate and timely credit i.e. Working Capital / Block Capital or both to small artisans, hadloom weavers, service sector, fishermen, self employed persons, rickshaw owners, other micro-entrepreneurs, etc from the banking system in a flexible, hassle free and cost effective manner.

v      The facility would also include a reasonable component for consumption needs.

2

Quantum of Limit

v      Rs.25000/- per borrower as composite loan. In deserving cases branch may consider sanctioning a higher limit upto Rs 30000/-

v      Working capital limit to be fixed at 20 %projected annual turnover.

v      A component for consumption credit not exceeding 20 % of limit could be built in keeping in view the value of family labour in the activity.

3

Sanction of Term Loan / Working Capital Limit

v      Term Loan will be provided for meeting the Investment requirement and to be repaid within 5 years

v      Revolving Cash Credit will be fixed taking into account the operating cycle/ nature of investment and shall be fixed on available balance after sanction of term loan

4

Nature of facility

v      A Composite Loan including Term Loan / Revolving Cash Credit

5

Validity

v      Valid for 5 years subject to satisfactory operations of the account and renewed on a yearly basis through simple review process

v      The operations in the account should be regular.

6

Issue of Cards

v      A laminated credit card and a passbook along with photograph.

v      This will serve as an identity card as well as facilitate recording of the transactions on an ongoing basis.

7

Processing Charges

v      NIL

8

Renewal

v      Working Capital Limit will be renewed annually

9

Operations of the Scheme

v      Opening of SB is not a precondition for issue of SCC

v      Rate of interest as applicable to SB a/c should be paid on credit balance in cash credit accounts under Swarojgar Credit Card Scheme.

10

Insurance

v      Group Insurance Scheme

v      Premium shared between Bank and Borrower equally

11

Margin & Collateral Security

v      NIL

12

Documentation

v      Composite Loan Document

14

Rationale

v      RBI advised implementation of new scheme for small artisans, handloom weavers and other micro-entrepreneurs.

15

Reference

v      CirCO/Adv/245/2003-04 dated 14/01/04