Central Bank of India partners with UP micro finance institution

Public sector Central Bank of India has partnered with a micro finance institution (MFI) to extend financial aid to the manual rickshaw pullers in Uttar Pradesh.

The scheme under the aegis of Rickshaw Federation Programme aims at facilitating rickshaw pullers to own their rickshaw units and to slowly bring them under the formal banking system.

“Central Bank of India is providing us the credit to run this scheme, which will provide brand new rickshaws to 1,500 persons in this phase. The beneficiaries will have to repay the amount in a weekly installment of only Rs 230 for three years,” partner MFI Bhartiya Micro Credit (BMC) managing director Vijay Pandey told Business Standard.

The programme has been launched in association with American India Foundation (AIF), which targets to providing livelihood support to low income and financially excluded groups.

The Federation aims at helping rickshaw pullers to own their rickshaw on easy installments. They are provided with brand new rickshaws along with accidental insurance policy, uniform, rickshaw licence, municipal permits, bank account and other social benefits.

In UP, the scheme has been launched in Sitapur, Kanpur, Mirzapur and Lucknow districts. So far, BMC has joined hands with Punjab National Bank, Central Bank of India and Small Industries Development Bank of India (SIDBI), while MoUs with two more public sector banks are likely to be signed soon.

Central Bank of India chairman and managing director S Sridhar and AIF vice chair Pradeep Kashyap will formally launch this leg of the programme on November 9.

“In the last three years, our joint efforts have provided rickshaws to 12,000 beneficiaries in Uttar Pradesh, Assam, Bihar and Delhi. More than half of these beneficiaries have already become the owners of rickshaws,” Pandey said.

The micro finance space is quite extensive in India, and SIDBI and other banks partner with MFIs and NGOs to reach the targeted groups.