Swarojgar Credit Card Scheme

• SCC Scheme aims at providing adequate and timely credit ie. working capital or block capital or both to small artisans, handloom weavers, service sector personnel, fishermen, self employed persons, rickshaw owners, other micro-entrepreneures, SHGs, etc., from the banking system in a flexible, hassle free and cost effective manner.
  
  
• Borrowers in urban areas can also be covered under SCC Scheme. Small business covered under priority sector is also eligible under SCC Scheme.
  
  
• Any scheme/project that is income generating/ employment generating may be covered under the scheme. The facility may also include a reasonable component for consumption needs.
  
  
• Farm sector activities like fisheries, dairy, etc., can also be covered under the scheme. Generally such of the self-employment activities which have regular turn-over/income stream on short-interval basis can be covered under SCC scheme.

Details

Nature of financial accommodation

Quantum of limit

Renewal of SCC limits

Interest on credit balance

Validity

Issue of cards

Operation of the scheme

Insurance

Security/Margin/Rate of interest /Prudential norms

NABARD refinance

Monitoring

Publicity on SCC Scheme

SCC to SHGs

Self Help Groups (SHGs) can also be issued SCC and members will be liable jointly and severally for repayment. As the Groups mature, some members may graduate to entrepreneurs and start their own micro- enterprises with or without the support of the SHGs. In such cases, SCC may be issued to members in individual capacity.

Nature of financial accommodation

The credit facility extended under the Scheme is in the nature of a composite loan including term loan / cash credit or both .

Quantum of limit

Upto Rs. 25,000/ per borrower as composite loan. This is indicative. Banks may consider higher limits on the merits of the case. A component for consumption credit could be built in keeping in view the value of the family labour in the productive activity. The total limit would have a relationship with the projected net earning and the repayment capacity of the borrower.

Renewal of SCC limits

Limits will be renewed annually based on the amount credited to the cash credit account /repayments.

Interest on credit balance

Interest as applicable to SB A/c may be paid to the borrowers on the credit balance under the account.

Validity

SCC is normally valid for 5 years subject to satisfactory operation of the account and renewed on a yearly basis through simple review process.

Issue of cards

The beneficiaries under the scheme will be issued with a laminated credit card and a pass book. This will serve as an identity card and facilitate recording of the transactions on an ongoing basis. Banks may modify the format keeping in view the relevant data/ information required. A passport size photograph of the holder will be affixed on the card in the space provided for .The card holder would be required to produce the card and the pass book for operations in the account. As far as possible cluster approach may be followed in implementing the scheme. In case smart cards are issued, fees towards issue of card/processing may not exceed Rs 50/- per card.

Operation of the scheme

The banks may at their discretion permit operations through the designated branches, taking into account the convenience of the clientele. Opening of SB A/c should not be a precondition for issue of SCC.

Insurance

Beneficiaries under the scheme would automatically be covered under the group insurance scheme and the premium would be shared by the bank and the borrower equally. Each bank may negotiate the terms of insurance with a company of its choice on a national or regional basis. Further, as advised by General Insurers’ (Public Sector) Association of India (GIPSA), it would be advisable for the banks to take up the matter of Personal Accident Insurance linked with SCC scheme individually with the Insurance Companies. Since many banks have tie-ups for bancassurance agreement with General Insurance Companies they may decide to include SCC scheme also under their tie-ups.

Security/Margin/Rate of interest /Prudential norms

Security, Margin, Rate of interest and Prudential norms are applicable as per RBI/NABARD norms. The interest rate would not exceed that for comparable farm loans. However banks may follow RBI instructions in this regard. Interest linked incentives may be given for timely repayment. Women borrowers may be given preference. Joint liability groups could be encouraged as a collateral substitute.

NABARD refinance

NABARD refinance will be provided for advances under SCC Scheme to eligible banks against their lendings to the borrowers in rural areas as per norms under the Enterprise Loan Scheme.

Monitoring

NABARD has been nominated by Govt. of India as the nodal agency for monitoring the scheme. Banks are required to report monthly progress to concerned Regional Offices of NABARD to facilitates monitoring.

Publicity on SCC Scheme

NABARD has published brochures on SCC scheme in English, Hindi and various regional languages. Regional Offices of NABARD conduct familiarisation programmes for bankers on the scheme.