The National Handloom Development Programme: Concessional Credit/Weaver MUDRA Scheme is a key component of the National Handloom Development Programme (NHDP), launched by the Ministry of Textiles, Government of India. The scheme aims to boost the competitiveness, productivity, and sustainability of the handloom sector by providing financial support to eligible handloom weavers, entrepreneurs, and organizations. This financial assistance is delivered in the form of concessional credit, margin money assistance, interest subvention, and credit guarantee, thereby enabling traditional artisans to upgrade technology, enhance infrastructure, and improve marketability.
Benefits
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Margin Money Assistance:
- Individual Handloom Weaver/Weaver Entrepreneur: 20% of the loan amount, subject to a maximum of ₹25,000.
- Handloom Organizations: Margin money assistance is provided at 20% of the loan amount, subject to a maximum of ₹20 lakh (i.e., ₹2 lakh per 100 weavers/workers, whichever is less).
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Interest Subvention:
Eligible handloom organizations can avail of subsidized loans at a concessional interest rate of 6% per annum for a period of up to 3 years (subject to a maximum cap of 7% by the Government of India). -
Credit Guarantee:
Loans extended to eligible handloom organizations are backed by a credit guarantee provided by the National Credit Guarantee Trustee Company (NCGTC) or the Credit Guarantee Fund Trust for Micro & Small Enterprises (CGTMSE), covering up to 75% of the outstanding loan amount. The credit guarantee fee is borne by the Government of India for a period of 3 years. -
Loan Classification:
Loans up to ₹10 lakh are covered under MUDRA, whereas loans above ₹10 lakh fall under the Concessional Credit component.
Eligibility
Eligible beneficiaries include:
- Individual Handloom Weavers: Engaged in the actual weaving activity.
- Weaver Entrepreneurs: Those running their own handloom units.
- Self Help Groups (SHGs) and Joint Liability Groups (JLGs): Formed by handloom weavers.
- Handloom Organizations: Including Primary Handloom Weavers’ Co-operative Societies, Apex Handloom Weavers’ Co-operative Societies, State Handloom Corporations.
- Producers’ Companies/Consortia: Promoted by handloom weavers, including those under cluster/mega cluster/handloom parks under schemes like SITP.
Note:
- Individual weavers who have already availed of margin money assistance under other structures (such as SHGs or handloom organizations) are not eligible for additional financial assistance in terms of margin money, interest subvention, and credit guarantee fee.
- Fresh loans may be sanctioned after one year of repaying a previous MUDRA loan.
Application Process
Offline
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Collection of Application Form:
Eligible beneficiaries must approach their participating bank or financial institution (such as District Central Cooperative Banks, Scheduled Commercial Banks, or others as designated under the scheme) to collect the application form. -
Form Completion:
Complete the application form by filling in all mandatory fields, attaching a passport-sized photograph (signed across, if required), and self-attesting all required documents. -
Submission:
Submit the duly filled and signed application form along with the necessary documents to the concerned authority at the participating bank. -
Acknowledgment:
Request a receipt or acknowledgment from the authority, ensuring it includes the date, time, and a unique identification number (if applicable). -
Claims for Subsidies:
Participating banks will process and sanction loans to handloom organizations, and they must lodge claims for margin money assistance, interest subvention, and credit guarantee fee via the Handloom Weaver MUDRA Portal (https://cocd.mypnb.in/login.aspx) in association with Punjab National Bank.
Documents Required
- Identity proof issued by the Office of the District Collector (Handlooms).
- Yarn passbook or similar document (if applicable).
- Identity proof issued by the State Government.
- For Handloom Organizations:
- Registration Certificate, Balance Sheet, Profit & Loss Account
- List of registered weavers
- Any other documents as required by the scheme guidelines.
Frequently Asked Questions
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What is the ‘Concessional Credit/Weaver MUDRA Scheme’?
It is a financial assistance scheme under the National Handloom Development Programme that provides margin money assistance, interest subvention, and credit guarantee to eligible handloom beneficiaries. -
What is the aim of the scheme?
To enhance the competitiveness, productivity, and sustainability of the handloom sector by facilitating financial support for technology upgradation, infrastructure improvement, and market expansion. -
Which banks are eligible to participate?
All Scheduled Commercial Banks, Regional Rural Banks, State Cooperative Banks, District Central Co-operative Banks, and any other financial institution approved by the Ministry of Textiles. -
What are the key benefits of the scheme?
Key benefits include margin money assistance (20% of the loan, with limits as applicable), interest subvention at a concessional rate, and credit guarantee coverage on loans. -
What is the rate of Margin Money Assistance for an Individual Weaver?
20% of the loan amount, subject to a maximum of ₹25,000. -
What is the rate of Margin Money Assistance for Handloom Organizations?
20% of the loan amount, subject to a maximum of ₹20 lakh (or ₹2 lakh per 100 weavers, whichever is lower). -
Who is eligible for Interest Subvention?
Interest subvention is available to eligible handloom organizations only. -
How long is the Interest Subvention applicable after the first disbursal?
Interest subvention is applicable for a maximum of 3 years from the date of the first disbursal. -
Which organizations are eligible for Credit Guarantee?
Eligible handloom organizations such as Primary and Apex Handloom Weavers’ Co-operative Societies, State Handloom Corporations, and other producer groups can avail of the credit guarantee. -
Where is the Margin Money Assistance transferred for Handloom Organizations?
It is transferred directly to the loan account of the Handloom Organization. -
How is the Interest Subvention and Credit Guarantee Fee managed?
These amounts are transferred to the concerned bank by the government. -
Who are eligible to avail loans under this scheme?
Eligible applicants include individual handloom weavers, weaver entrepreneurs, SHGs, JLGs, handloom organizations, and producer companies/consortia. -
What is the eligibility criterion for individuals who have already availed Margin Money Assistance?
Individual weavers who have already availed margin money assistance under other structures are not eligible for additional benefits. -
What is the eligibility criterion for a fresh loan?
Fresh loans may be sanctioned after one year of repayment of previous MUDRA loans. -
How can one apply for a loan under the scheme?
Applicants must visit a participating bank, collect and complete the application form, attach the necessary documents, and submit the form to initiate the loan process.