Experience has revealed that apart from counseling and training, delivery of credit poses the most serious problem for the poor women. Since such women will not be able to have an easy access to credit, it has also been envisaged that the credit will be made available to applicant woman through NGOs who would be capable of handling funds in an appropriate manner. These NGOs will not only handle the disbursement of such loans needed by women but would also provide them adequate counseling & training for taking up productive activities. The focal point of the scheme is to provide grant assistance to the nodal NGO which has been sanctioned bank loan for passing through the same to eligible women for taking up non-farm activities.
There is a provision for Government of India Grant up to 30% of the loan/ credit maximum up to Rs. 30.lakh as appraised by lending institution/ banks. The lending institutions/ banks would finance loan assistance for women through NGO for undertaking non-farm activities . GOI Grant and the loan portion from the lending agencies to assist such women shall be routed through NGOs engaged in assisting poor women through income generating activities. While the loan amount will be passed on to women beneficiaries, the Grant shall be utilized by the NGOs for activities accepted as grant activities in the appraisal report of the lending agency and capacity building of the NGOs. NGO which has been selected for Government Grant will not be considered for GoI grant again in the subsequent two years from the date of release of GoI grant