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MOU Signed for Providing Centralized Platform for Processing Interest Subsidy to Eligible Beneficiaries under Sep Component of Day

Capital Market 

A Memorandum of Understanding(MOU) has been signed in the presence of ShHardeep Singh Puri, Minister of State(I/C) Ministry of Housing and Urban Affairs to provide a centralized platform for processing interest to eligible beneficiaries under Self Employment Programme (SEP) component of (DAY-NULM). The MOU was signed between Ministry of Housing and Urban Affairs (MOHUA) and here today. Smt. UshaAnanthasubramaniyan, MD &CEO, and Shri Sanjay Kumar, from the signed the MOU. Ms.

Archana Mittal, Director, from the Ministry were also present on the occasion.

The will provide an end-to-end solution for processing interest for NULM schemes. The will be credited to linked beneficiary account in a seamless process through DBT mode. The portal will also facilitate of loans granted by Banks, through Urban Local Bodies.

Under the Self-Employment Component (SEP) of NULM, for setting up micro- enterprise are available to individuals (upto 2 lakhs) and groups (upto 10 lakhs) of urban poor; consumption loans (as per the savings) are also available for Self Help Groups (SHGs). Interest subvention from Ministry is available for the amount of interest charged over and above 7% , by the banks and women SHGs are eligible for additional 3% subvention on timely repayment

Currently, processing of interest subvention is manual - banks submit claims to ULBs on a monthly basis, who then verify and settle them - tedious and time-taking process

Delay or non-submission of claims by banks for interest subsidy

No mechanism to ascertain whether beneficiary has received subsidy or not

As on 31st December 2017, the interest subsidy claimed by banks is Rs 204.27 crore, against an estimated amount of subsidy claim of Rs 700 crores (FY 2014-15 to Q3 2017-18).

Under the Proposed System, Common centralized IT platform for all states, to streamline release of interest subsidy and facilitate proper monitoring - selected for the design and development of portal. Claims will be uploaded by of banks on the portal; concerned States/ULBs will verify the beneficiaries, after which the claim amount will be transferred to the beneficiary through Direct Beneficiary Transfer (DBT) mode; will be sent to beneficiary intimating him about release of subsidy in his account; Allahabad Bank will charge a service fee of 1.05% of interest subsidy amount released; Ministry, States and ULBs will get reports to monitor interest subvention delivery; will be functional by beginning of FY 2018-19.

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Wed, January 10 2018. 08:46 IST
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