UP excels in credit scheme for unorganised sector

Achieves 88 per cent target in Swarojgar Credit Card.

Uttar Pradesh has excelled in a central credit scheme for the self employed in the unorganised sector by achieving over 88 per cent of the target.

Swarojgar Credit Card (SCC) scheme was introduced in 2003 to provide easy and timely credit to artisans, handloom weavers, fishermen, rickshaw pullers and other such self employed persons, especially in the rural areas.

Against the target of 30,000 cards in 2009-10 financial year, different banks in Uttar Pradesh have achieved the mark of 26,438, which is over 88 per cent of the target.

The scheme is implemented through commercial banks, Regional Rural Banks (RRBs) and cooperative banks. National Bank for Agriculture and Rural Development is the nodal agency for monitoring this central scheme.

“UP would certainly rank among the best performing states in promoting the SCC scheme among targeted people,” Aryavart Gramin Bank (AGB) credit officer P P Srivastava told Business Standard.

AGB has over 300 branches in the districts of Barabanki, Farrukhabad, Kannauj, Hardoi, Unnao, Lucknow and Faizabad.

Cumulatively, about 1,85,000 SCCs had been distributed in UP so far, while the total credit stands at Rs 612 crore.

AGB alone has over 15,000 SCC accounts and disbursed more than Rs 50 crore in the state.

The credit charged under the scheme is about eight per cent. A composite loan of Rs 25,000 per borrower is permissible under the scheme, inclusive of terms loan and revolving credit limit as per the need and repayment capacity of the borrower.

However, banks may consider offering higher limits above Rs 25,000 and in deserving cases, up to Rs 50,000.

“The scheme covers both the capital and working capital needs of the borrower,” Srivastava added.

Besides, Self Help Group are also considered under the scheme. Some banks also provide value addition with such accounts. For example, AGB provides insurance cover to the beneficiaries.