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No institutional facilities for savings
except some hand savings or savings in the
form of livestock or gold (very negligible)
is an issue of concern in connection with
the livelihood portfolio of the communities.
The production system requires some kind of
investment in terms of seeds, fertilizers,
technology, raw materials, labour etc.
Except home saved inputs and his family
labour, the poor tribal is not able to
invest anything more because of non
availability of financial resources which
results in low yield/ production and low
income. Sometimes in critical situations,
where the poor predicts the failure of
assured income, he/she requires credit to
protect his production and to secure the
food availability round the year. Besides,
the poor also needs credit on the occasion
of festivals and critical illness. The
programme, through the component of RFS
would facilitate the poor households to meet
the critical credit needs either for
production and/or consumption. The component
has been reflected in all categories of
livelihoods option adopted by the poor. The
resources under this component will be
routed through the VDC to the SHGs. As an
initial promoting incentives, each SHG (old
as well as the existing SHGs) in the
programme areas will receive a small kit of
pre-designed non negotiable registers,
formats, stationeries etc. not exceeding
Rs.500/- per SHG. This grant will be given
to the SHG after the formation of the SHG.
In case of the existing SHGs the existing
practice of the maintenance of records to be
evaluated by the FNGOs and accordingly the
preliminary support will be given, wherever
required. The funds in this regard will be
released to the VDCs and the VDCs will make
purchase of the items to be given to the
SHGs.
As a
beginning of the facilitation process, Seed
capital will be given as an incentive to the
SHGs promoted or strengthened in the
programme. Rs. 50000.00 allocation per MWS
has been fixed to meet the immediate credit
needs of the newly promoted groups or the
very vulnerable groups strengthened by the
programme. The funding should differ from
group to group ranging from Rs.2000/- to
Rs.5000/- per group depending upon its
capacity and requirement. It is a grant
component to the SHGs and should not be
refunded by them to the VDC. But the members
within the group will have access to the
seed capital as credit and the members who
will take loan from the seed money have to
repay it to the group. Thus it will
facilitate the internal lending within the
group and will also increase the financial
base of the group, which will facilitate
linkages with financial institutions. The
group as a whole can also take credit from
this fund for small income generating
activity.
Leaving aside
the seed capital and initial start up grant,
the major share under this component is the
revolving fund. The total amount under
revolving fund is Rs. 2.25 lakhs per micro
watersheds, which will be given to the VDC
in phases. The VDC will release the funds to
the respective SHGs depending upon their
livelihood plan. This will foster the
community to take credit and invest it in
the livelihood options as capital investment
or working capital investment.
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