Green Business Scheme

The world is grappling with the issue of climate change. Newspapers are brimming with reports of losses in agricultural income, the melting of glaciers, deaths due to heat waves, city lanes clouded with toxic smoke, a rise in sea levels, etc. all thanks to this global warming menace, which is only expected to get worse. Green Business Scheme was initiated to provide financial support for activities which can tackle the issue of climate change without disrupting the flow of income. In this article, we look at the Green Business Scheme in India in detail.

Objective

The scheme was launched to extend loans to the activities which could tackle the issue of climate change along with income generation. The scheme intends to cover the income generating activities which could mitigate the Green House effect.

Who is Eligible?

Loans under this scheme are extended to people of the Scheduled Caste community, whose income is bracketed under the “Double the poverty line” category.

Coverage

The scheme applies to the procurement and utilization of the following:

Battery electric vehicle
Compressed air vehicle
Solar energy gadgets
Poly houses

Total Assistance Provided

Qualified citizens can claim financial assistance for the unit cost of up to Rs 2 lakhs. The National Scheduled Castes Finance and Development Corporation (NSCFDC) will provide a loan of up to 90% of the unit cost, and the remaining 10% will be contributed by the promoter. NSCFDC would accord the loans based on requirements, in consideration with the NSFDC Term Loan Lending Policy, promoter’s contribution including the margin money provided by SCA’s, subsidy provided to other Governmental agencies and Below Poverty Line (BPL) beneficiaries under the Central Sector Scheme of Special Central Assistance to the Special Component Plan up to a range of Rs. 10,000 or 50% of the unit cost, whichever is less.

Interest Rates

The NSCFDC will levy an interest under the scheme at the rate of 2% per annum from the SCA’s. The latter, in-turn, will levy an interest rate of 4% per annum from the beneficiaries. Female beneficiaries will be granted a rebate of 1% from NSCFDC’s share of interest.

Repayment

The loan is to be repaid in quarterly installments. The entire quantum of loan must be repaid within six years, which includes the moratorium period of 6 months. It may be noted that a moratorium period of 120 days is granted to SCA for utilization of funds.

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Frequently Asked Questions

Common questions about Green Business Scheme Loans for Climate Change in India.

The Green Business Scheme is an initiative that provides financial assistance in the form of loans for income-generating activities that can help mitigate climate change and greenhouse gas emissions. It aims to support environmentally-friendly businesses and projects that contribute to sustainable development.

Individuals from the Scheduled Caste community whose income falls under the "Double the poverty line" category are eligible to apply for loans under the Green Business Scheme.

The scheme covers the procurement and utilization of battery electric vehicles, compressed air vehicles, solar energy gadgets, and poly houses, which are considered eco-friendly and help reduce carbon footprint.

Qualified citizens can claim financial assistance for up to Rs 2 lakhs, which is the maximum unit cost covered by the scheme. The National Scheduled Castes Finance and Development Corporation (NSCFDC) will provide a loan of up to 90% of the unit cost.

The NSCFDC will levy an interest rate of 2% per annum from the State Channelizing Agencies (SCAs), which in turn will charge an interest rate of 4% per annum from the beneficiaries. Female beneficiaries are eligible for a 1% rebate on the NSCFDC's share of interest.

The loan must be repaid in quarterly installments over a period of six years, which includes a moratorium period of six months. Additionally, SCAs are granted a moratorium period of 120 days for utilization of funds.

The main objective of the Green Business Scheme is to promote income-generating activities that can help tackle climate change and reduce greenhouse gas emissions, while also supporting the livelihoods of individuals from the Scheduled Caste community.

By promoting the use of eco-friendly technologies and practices, such as battery electric vehicles, solar energy gadgets, and poly houses, the Green Business Scheme contributes to reducing carbon emissions and mitigating the effects of climate change.

The NSCFDC is responsible for extending loans to eligible beneficiaries under the Green Business Scheme, based on the NSFDC Term Loan Lending Policy and in consideration of the promoter's contribution, subsidies, and other factors.

No, the loan amount provided under the Green Business Scheme must be utilized for the procurement and utilization of the specified eco-friendly activities, such as battery electric vehicles, compressed air vehicles, solar energy gadgets, and poly houses.