Mission Shakti, launched in 2001 by the Government of Odisha, is a state-sponsored program that aims at empowering women through Self Help Groups (SHGs). A key component of this initiative is the Mission Shakti Loan Scheme, which provides financial assistance to these groups to support their livelihood activities.
- Interest Rate Subsidy: The state government offers a significant interest subvention on loans availed by eligible SHGs. This reduces the overall financial burden and makes borrowing more attractive.
- Subsidy: The state government offers an interest subvention scheme, effectively reducing the interest rate to 0% for loans up to Rs. 3 lakhs, provided timely repayments are made.
- Beyond Rs. 3 lakhs: The interest rate for loans exceeding Rs. 3 lakhs is determined by the bank lending the money.
- Loan Availability: SHGs can avail loans for various purposes, including setting up micro-enterprises, agriculture, animal husbandry, handicraft production, and small-scale trading activities.
- Loan Amount: The specific loan amount varies depending on the nature of the business activity and the SHG’s repayment history.
- Repayment: SHGs are expected to repay the loan within a stipulated timeframe. Prompt repayment is crucial for maintaining a good credit history and accessing larger loans in the future.
- Target Group: Exclusively for women members of SHGs in Odisha.
- Loan Purpose: To support income-generating activities, including micro-enterprises, agriculture, small businesses, handicrafts, and more.
Eligibility
- Self Help Groups: Only registered and functional women’s SHGs meeting specific criteria are eligible to avail loans under this scheme.
- Repayment Track Record: SHGs with a positive repayment history in previous loans are generally prioritized.
Mission shakti Benefits
- Financial Independence: Access to credit empowers women to run their own businesses and generate income, leading to greater financial freedom and decision-making power within their families and communities.
- Income Generation: Loans enable SHGs to invest in their businesses, expand operations, and increase their earning potential.
- Improved Standards of Living: Economic empowerment of women translates to better living conditions for their families and contributes to overall societal development.
- Skill Development: Managing loan finances and business operations helps women develop new skills and gain valuable entrepreneurial experience.
How to Apply Mission shakti Loan
- Form a Self Help Group: A group of 5-10 women in a village can come together and form an SHG.
- Register with Mission Shakti: The SHG needs to register with the Department of Mission Shakti.
- Savings and Capacity Building: The SHG members need to start saving regularly and participate in capacity-building programs offered by the department.
- Loan Application: Once registered and trained, the SHG can apply for a loan from a bank linked with the Mission Shakti program. The bank will assess the application and decide on the loan amount and terms.
Eligibility Requirements for Online Loan Applications by Self-Help Groups (SHGs)
- Minimum Group Age: The SHG must be at least six months old on the date of applying for the loan. This ensures a certain level of stability and group cohesion before accessing credit.
- Clean Credit History: The SHG cannot be classified as a Non-Performing Asset (NPA). This means they must have a good track record of repaying previous loans if any.
- Strong Performance: The SHG must be graded with a band A or B. This grading system likely assesses the group’s financial management, meeting attendance, and overall effectiveness.
- Active Communication: The SHG must have at least one active mobile number. This allows for easy communication between the SHG and the lending institution during the application process and beyond.
Required Documents for SHG Loan Application
Group Information
- Resolution/Minutes (Discussion on Bank Loan): Signed document outlining the group’s decision to apply for a loan. – Example
- Grading Sheet: Official document issued by a designated authority reflecting the SHG’s performance rating (e.g., Band A or B). – Example
- Group Photo: A recent photograph of all SHG members.
Financial Documents
- Front Page & Last Transaction Page of Bank Passbook: Verification of the SHG’s existing bank account.
- Financial Statement (Last One Year): Audited financial statements summarizing the SHG’s income and expenses for the past year.
- Cash Book (Last Six Months): Detailed record of the group’s cash inflows and outflows for the past six months.
- Other Document (NOC from Bank etc.): (Optional) Any additional documents required by the specific loan program, such as a No Objection Certificate (NOC) from a previous lender.
Member Information
- Identity & Address Proof of Authorized Representative/Leader – 1 (Aadhaar etc.): Government-issued ID and address proof of the primary authorized representative.
- Identity & Address Proof of Authorized Representative/Leader – 2 (Aadhaar etc.): Government-issued ID and address proof of the secondary authorized representative (if applicable).
- Membership Undertaking (No Dual Membership & Default Loanee Member): Signed document by each member confirming no membership in other SHGs or outstanding loan defaults.
- Group Photo: A recent photograph of the SHG members.
- Activity Plan: Outline of the SHG’s business activities and how the loan will be used. – Example
Mission shakti Loan Eligible Banks
All Banks with Core Banking Solutions (CBS): Any bank, regardless of category, that utilizes Core Banking Solutions (CBS) can participate in the scheme and offer the interest subvention to SHGs.
Types of Banks:
- Scheduled Commercial Banks: This category includes public sector banks (owned by the government), private sector banks (owned by private entities), and foreign banks operating in India.
- Co-operative Banks: These are member-owned financial institutions that primarily serve rural communities.
