The National Handicapped Finance and Development Corporation (NHFDC) has been set up by the Ministry of Social Justice & Empowerment, Government of India on 24th January 1997. The company is registered under section 25 of the Companies Act, 1956 as a Company not for profit. It is wholly owned by Government of India and has an authorised share capital of Rs. 400 crores (Rupees Four Hundred Crore only). The company is managed by Board of Directors nominated by Government of India.
Objectives
> Promote economic development activities for the benefit of persons with disabilities.
> Promote self-employment and other ventures for benefit/economic rehabilitation of persons with disabilities.
> Extend loans to persons with disability for pursuing professional/technical education leading to vocational rehabilitation/self employment.
> Assist in the upgradation of technical and entrepreneurial skills of persons with disability for proper and efficient management of production units.
> Assist self-employed individuals with disability in marketing their finished goods.
Implemented through Non Government Organisations (NGOs)
Purpose of Loan
Purpose of the loan is to provide financial assistance to weaker section of the disabled for starting or augmenting income generating activities. The illustrative nature of income generating activities are given below:
- i) Small business/trade
- ii) Tiny/cottage industry or service activity.
iii) Artisan activities.
- iv) Agricultural and allied activities.
Quantum of Loan and Rate of Interest
Under the scheme of Micro Financing, loan upto an amount of Rs. 5,00,000/- (Rupees Five lakh only) is given to an NGO for further disbursement to individual beneficiary upto an amount of Rs. 25,000/- (Rupees Fifteen Thousand only) per beneficiary at a rate of interest not exceeding 5% per annum on convenient repayment period of 36 months and on convenient terms. The NGO may retain 3% of the interest margin towards its administrative cost & pay only 2% interest to NHFDC. Additionally, the NGO is also given Rs. 10,000/- as one time grant towards implementation of the scheme.
Eligibility
- a) Any India Citizen with 40% or more disability.
- b) Annual income below Rs. l,00,000/- for urban areas and Rs. 80,000/- for rural areas.
- c) Age between 18 and 55 years. .
- d) The borrowers already covered under any other scheme of financing sponsored by Central or State Government or financing institutions and having outstanding loans against their names shall not be eligible.
- e) The borrowers should preferably be regular member of Thrift and Credit Group (Self Help Group).
- f) Preference will be given to women beneficiaries.
- g) Relevant educational/technical/vocational qualification, experience and background.
Implementing Agency
NHFDC will provide credit though NGOs (Non Government Organisations) in Rural and Urban areas who are working in the social sector. The NGOs will further finance the beneficiaries either directly or through Self Help Group (SHGs). The NGOs would be advised to select their beneficiaries for financing in villages/areas different from any other agency to avoid any duplication.
- a) An NGO intending to implement Micro Credit Scheme should have the objective of serving the social and economic needs of the weaker sections of the Persons with Disability.
- b) It should have the necessary flexibility, professional competence and basic financial management capability and organisation skills to implement the lending programme. It must have out reach services in the operational areas.
- c) Its office bearers should not be elected members of any political party.
- d) It should have a proper system of maitaining accounts. Accounts should have been audited. There should not have been by serious irregularities observed in the audit, and its accounts should publish. The applicant NGO should have been registered for at least three years and it should have good reputation.
- e) It should be running on sound lines and preferably have experience of Thrift and Credit administration of at least three years and its recovery performance during the last three years should be approximately 90%.
Financing Patterns
NHFDC would provide 100% of the project cost to the selected NGOs for disbursement to beneficiaries.
Other Incentives for Implementing
Agencies A grant of Rs. 10,000/- will also be given to NGO’s for promoting, implementing and launching the Micro Financing scheme and educating ultimate borrowers, organising self help groups of persons with disability if required, follow up action and recovery.
- i) The NGOs to which funds have been sanctioned can make the drawl of funds as per requirement within the credit limit sanctioned, which generally will be for one year.
- ii) Te first drawl will be made not later than one month from the date of sanction unless the limit is extended by the NHFDC. If the lending operation are not so commenced, the NHFDC will be at liberty to cancel the sanction or vary any of the terms and conditions.
Repayment
The funds made available to any NGOs are to be utilised within a period one month from the date of release of funds. The NGOs will be required to send monthly report on utilisation of funds in the prescribed format. The funds remaining unutilised due to any reason, will be required to be refunded within a fortnight on expiry of utilisation period indicated in the sanction letter. Any delay in refund of such amounts will carry penal interest @ 18% per annum.
Term loans drawn from NHFDC will be required to be repaid within a period of 36 months in quarterly installments. The interest shall be repayable to NHFDC on 30th June. 30th September, 31st December and 31st March every year or on such other dates as agreed to by NHFDC. Six days grace period will be admissible for payment of any installment to NHFDC. Penal interest of 2% will be levied on delayed payments upto one month. In the event of default persisting beyond one month, penal interest will be charged @ 18% per annum.
Security
The loan sanctioned to NGOs may be secured by such securities/guarantees as may be prescribed by NHFDC in the sanction letter.
Books for Accounts/Inspections
The NGOs shall maintain separate accounts in respect of the funds provided by NHFDC. Annual audited account will be submitted within four months after close of the accounting year of the NGO within the statement of lending and recoveries during the year. Any other information required will also have to be submitted as and when requested.
Procedure for obtaining Loan
The NGOs desirous of implementing NHFDC’s Micro Financing Scheme will have to submit proposal for obtaining funds indicating the purpose, the estimated number of borrowers and the aggregate amount required for each purpose. The application will be submitted in the prescribed format. Along with the application, the NGOs will submit annual report for last two years and balance sheet and audited accounts for last three years. Based on the information given in application, and if required by inspection of the NGO, NHFDC will prepare a report on past antecedents, performance, competence and capacity of the concerned NGO. The report will include the recommendations regarding suitability of the NGO for implementation of NHFDC’s scheme of Micro Financing Scheme and its capacity to handle number of beneficiary’s vis-à-vis the amount of funds. The application along with other reports will be submitted for consideration of competent authority before sanction. The sanction letter will be issued to the NGO giving details of terms and conditions of the financial assistance including utilisation period, recoveries, penal interest etc. Before any drawl are made/allowed, the NGO will have to execute the prescribed documents including a guarantee letter in the prescribed format.
Schemes of Parent’s association of mentally retarded person purpose
Purpose of the scheme is to provide loan to parent’s associations of mentally retarded to set up an income generating activity for the benefit of the mentally retarded persons. The nature of income generating activity will be such that it involves the mentally retarted persons directly and income will be distributed among the mentally retarded persons. The income generating activity will be managed by the parent’s association, which is expected to render its services voluntarily.
Eligibility
- a) The parents association should be registered for at least 3 years.
- b) It should have a minimum membership of 10 parents.
- c) It should not be a financial defaulter of central government, state government, any financial institution in the public sector, banks etc.
Quantum of Loan
Quantum of loan to each NGO is limited to Rs. 5.00 Lakh. The share of the NGO will be 5°/o of the project cost. The loan will be used by the NGO to implement a single or multiple activity project in which the maximum possible participation of the beneficiaries may be ensured.
Rate of Interest
The interest on the loan amount will be charged as per following table:
- i) Upto Rs. 50.000/- – 5% p.a.
- ii) Above Rs. 50.000/- and less than Rs. 5.0 lakh. – 6% p.a.
Repayment Period
The loan amount including interest will be repaid within 10 years in equal quarterly installments.
Insurance Cover
Adequate insurance cover may be obtained in respect of assets acquired by the NGO out of the loan advanced by National Handicaped Finance and Development Corporation. The premium of insurance will be paid by the NGO.
Management of the Project
The income generating activity for which loan is advanced by NHFDC will be managed by such office bearers of the parents association who are parents of mentally retarded children. It will hold at least one meeting in a quarter to review the implementation and progress of the project. A representative of NHFDC will also be attending such meeting to review the implementation of the project.
Procedure for Obtaining Loan
The loan application under the scheme will be submitted to National Handicapped Finance and Development Corporation directly by the NGO. However, the NGO should get a resolution passed by its managing committee/board of trustee to this effect. Proof of this should be submitted along with the application.
Schemes through State Channelising Agencies
The National Handicapped Finance and Development Corporation extends loan to the persons with disability through the State Channelising Agencies nominated by the respective state govemments/U.T.’s.
Applications on prescribed format are submitted through the State Channelising Agencies. Project upto Rs. 1.0 lakh are sanctioned by State Channelising Agency and projects more then Rs. 1.0 lakh are sanctioned by NHFDC.
Mahila Samridhi Yojna
Objective
To assist women with disability who are also economically weak, to start/augment income generating activities.
Eligibility
Any woman Indian Citizen with 40% or more disability, who has;
- a) Age between 18 and 55 years.
- b) An annual income below
- i) Rs. 1,00,000/- p.a., if residing in urban areas.
- ii) Rs. 80,000/- p.a., if residing in rural areas.
- c) Relevant educational/technical/vocational qualification, experience and background.
Implementing Agency
The scheme would be implemented through State Channelising Agencies of the Corporation as well as Non-Government Organisations (NGOs),
In case of NGOs, it is stipulated that :
- a) NGO intending to implement ‘Mahila Samridhi Yojna’ should have the objective of serving the social and economic needs of the weaker sections of the Persons with Disability.
- b) It should have the necessary competence and basic financial management capability and organisation skills to implement the lending programme. It must have out reach services in the operational areas.
- c) Its office bearers should not be elected members of any political party.
- d) It should have a proper system of maintaining accounts. Accounts should have been audited. There should not have been any serious irregularities observed in the audit, and its accounts should be published. The applicant NGO should have been registered for at least three years and it should have good reputation.
- e) It should be running on sound lines and preferably have experience of Thrift and Credit administration of at least three years and its recovery performance during the last three years should be approximately 90%
Loan Amount
There will be no limit on Loan amount to SCAs; and in case of NGOs the Loan amount per NGO would be limited to Rs. 5.0 Lakhs for. further disbursement to women with disability. The above is subject to maximum of Rs. 25,000/- per beneficiary.
Rate of Interest
Rate of interest to be changed from beneficiary shall not exceed 4% per annum on convenient repayment period of 3 6 months and on convenient terms.
Financing Pattern
NHFDC would provide 90% of the project cost.
Incentives for Implementing Agencies
A grant of Rs. 10,000/- of disbursed amount will be given to implementing Non-Government Organisations (NGOs) for promoting, implementing and launching the Mahila Samridhi Yojna and educating ultimate borrowers, organising self help groups of persons with disability if required, follow up action and recovery. An interest spread of 3% is allowed, i.e. the implementing agency is to pay the Corporation interest @ I Vo p.a. on loan amount, while it would be charging interest @ 4% p.a. to the ultimate beneficiary.
Books of Accounts/Inspections
The implementing agency shall maintain separate accounts in respect of the funds provided by NHFDC. Implementing agency shall furnish any information required by National Handicapped Finance and Development Corporation concerning loan given under this scheme.
National Banks
The National Handicapped Finance and Development Corporation extends loan to the persons with disability also through Punjab & Sind Bank (P&SB) & Oriental Bank of Commerce (OBC).
NGOs
For very poor borrowers, the corporation has Micro Financing Scheme, which is implemented through Non Government Organisations. Project applications from Non Government Organisations under Micro Credit Scheme are submitted directly to NHFDC.
Frequently Asked Questions
Ques. What is the objective of National Handicapped Finance and Development Corporation ?
Ans. The National Handicapped Finance and Development Corporation (NHDFC) is set up with the objective to economically empower the persons with disabilities in the country.
Ques. Who are eligible to take loan ?
Ans. Any Indian Citizen with minimum 40% or more disability, age between 18 and 55 years, annual income below Rs. l,00,000/- (Rupees One Lakh only) p.a. for urban areas and Rs. 80,000/- (Rupees Eighty Thousand only) p.a. for rural areas, with relevant educational/technical/vocational qualification/experience and background.
Ques. What are the schemes of financing and maximum amount of loan ?
Ans. The schemes of NHFDC are as follows:
- i) For setting up small business in Service/Trading sector : Loan up to Rs. 3.00 lakh (For transport activity – loan upto Rs. 5.00 lakh)
- ii) For setting up small industrial unit: Loan upto Rs. 5.00 lakh
iii) Loan for Education/Training to Disabled Persons : Loan upto Rs. 7.50 lakh for studies within India and Rs. 15.00 lakh for studies abroad.
- iv) For Agricultural activities : Loan upto Rs. 5.00 lakh
- v) For self-employment amongst persons with mental retardation, cerebral palsy and autism : Loan upto Rs. 3.00 lakh.
- vi) Financial Assistance for Skill & Entrepreneurial Development
Ques. What is the rate interest ?
Ans. The rate of interest is as follows :
| i) UptoRs.50,000/- | 5% |
| ii) Above Rs. 50,000/- and upto Rs. 5.0 lakh | 6% |
| iii) Above Rs. 5.0 lakh (loan for education/training) | 8% |
Ques. What is the maximum repayment period for loan and if there is any subsidy on loan ?
Ans. Maximum repayment period is 10 years and NHFDC is not providing any subsidy, however a rebate of 1% on interest is given to disabled women.
Ques. If an applicant is residing at a particular place, can be/she start his project activity from another state ?
Ans. The beneficiary should be resident at the place of his/her activity.
Ques. If an applicant is mentally retarded person, can bc/she avail loans from NHFDC ?
Ans. In such cases the financial assistance is extended through parents or spouse or legal guardian of the dependant mentally disabled person.
Ques. Can the applicant avail loan from NHFDC directly or what is the procedure to submit his/her application for loan ?
Ans. Applications on prescribed format to be submitted through the State Channelising Agency. Projects upto Rs. 1.0 lakh are sanctioned by State Channelising Agency/ Bank and applications for loan more than Rs. 1.0 lakh is sanctioned by NHFDC.
Projects may also be submitted through the branches of Punjab & Sind Bank or Oriental Bank of Commerce who have entered into a collaborative arrangements with NHFDC for implementation of the schemes of NHFDC.
(The schemes can be also implemented through NGOs)
Ques. What are activities, for which loan is available ?
Ans. Practically for any type of economically viable income generating activity, loan from NHFDC is considered.
Ques. What is the scheme for Non Government Organisations (NGOs) ?
Ans. The schemes for NGO are as under :
- a) Micro Financing Scheme Implemented through NGO – Loan upto Rs. 5.00 lakh.
- b) Mahiha Samridhi Yojna implemented through, NGO – Loan upto Rs. 5.00 lakh for NGO, upto Rs. 25.000/- per women beneficiary.
- c) Parent’s Association for the mentally retarded persons – Loan Rs. 5.00 lakh.
The Micro Financing Scheme is also implemented through State Channelising Agencies of NHFDC.
For further details, please contact:
State Channelising Agencies in your State/UT
or
National Handicapped Finance and Development Corporation
(Ministry of Social Justice & Empowerment)
Red Cros Bhawan, Sector – 12, Faridabad – 121 007
Tel: (0129) 2280214, 2280335, 2264841, 2287512, 2287513, 2226910
Tele Fax: (0129) 2284371
email: [email protected]
website: www.nhfdc.org