Govt to extend MUDRA loans to 5 lakh weavers in 3 years

30 Jun '16

2 min read

The ministry of textiles has set a target of extending loans under the Micro Units Development and Refinance Agency (MUDRA) scheme to five lakh handloom weavers in the next three years, textiles secretary Rashmi Verma has said.

The government is paying special attention to i) skill upgradation of weavers, ii) loom upgradation, iii) ensuring availability of good quality raw material, iv) providing better access to credit, and v) branding of good quality handloom products, Verma said at a national workshop on MUDRA scheme for handloom weavers and artisans, organised by Office of Development Commissioner (Handlooms), ministry of textiles, in New Delhi.

“The experience in implementation of Weavers Credit Card scheme has not been fully satisfactory; the per capita amount sanctioned is low and procedures are cumbersome,” Verma said, according to an official statement.

Availability of working capital is a critical component in enhancing earnings of weavers, she said, and informed that the government has formulated a new model under MUDRA scheme for providing credit to handloom sector. The new model combines elements of concessional credit such as margin money, interest subvention, and credit guarantee cover.

For implementation of the new model, the ministry of textiles has requested every state and union territory to prepare a three-year action plan to achieve the five lakh target. The plan would cover all handloom clusters, with the aim of extending MUDRA loans to all eligible, willing, non-defaulting handloom weavers. The plan would also identify banks for each cluster, keeping in view the presence of banks and their willingness to participate in the scheme. (RKS)

Fibre2Fashion News Desk – India

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