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Capital Support as Soft Loan to MFIs under MFDEF
NABARD provides Capital Support to various types of MFIs to enable them to leverage commercial and other funds from banks. The assistance is available between 20% and 50% of the total capital of the institutions or 10% of the loan outsanding at the end of the last financial year, whichever is lower, subject to maximum of Rs.10 crore to regulated agencies (NBFC) and Rs.5 crore to others (Other than NBFC).
A. Capital Support to MFIs
- Eligible MFIs:
- Registered under the Societies Act, 1860
- Companies, not for profit, incorporated under section 25 of the CompaniesAct, 1956, and specifically exempted from registeration by the RBI
- Public Trust under Indian Trust Act, 1882
- Co-operative Societies registered under the provision of the State Co-operative Societies Act or under the Mutually Aided or Mutual Benefit Co-operative Societies Act or Multi-State Co-operative Societies Act, 2002 or under any other law relating to the Co-operative Societies Act in force in India
- NBFCs as defined in the RBI Act, 1934 which are regulated by RBI and doing micro-finance services
- Eligibility Norms:
- MFI doing micro finance operations in financing SHGs or JLGs or individuals for a minimum period of two years
- MFI should have been rated by Credit Rating Agencies approved by NABARD, if the loan outstanding of the MFI exceeds Rs.50 lakh.
- MFI should not be charging usurious rate of interest from the ultimate client and effective rate of inerest including all charges should not normally be more than 25% p.a.
- Rate of Interest : The assistance is in the form of soft loan @ 3.5% p.a.
- Repayment Period: 5 years inclusive of 2 years moratorium period.
B. Capital Support to Start-up MFIs
- Eligible MFIs:
- MFI with a good track record of undertaking micro finance activities between 6 months to 2 years and having business upto Rs.1 crore, having borrowing members atleast 200 (150 in NER) and
- MFI should have been rated by Credit Rating Agencies approved by NABARD, if the loan outstanding of the MFI exceeds Rs.50 lakh.
- MFI should not be charging usurious rate of interest from the ultimate client and effective rate of inerest including all charges should not normally be more than 25% p.a.
- Rate of Interest : The assistance is in the form of soft loan @ 3.5% p.a.
Repayment period: 7 years inclusive of 2 years moratorium period. |
