Self Employment Schemes of NMDFC

Self Employment Schemes of NMDFC

Self Employment Schemes of NMDFC

National Minorities Development and Finance Corporation (NMDFC) in collaboration with the Ministry of Minority Affairs has launched the various scheme for the welfare of minority communities. This scheme was mainly developed to provide concessional finance to minorities for starting income generation activities. In this article, we look at the Self Employment Schemes of NMDFC in detail.

Self Employment Schemes of NMDFC

The following are the Self Employment Schemes of NMDFC:

  • Term loan scheme
  • Educational loan scheme
  • Microfinancing scheme

Term Loan Scheme

This scheme is for individual beneficiaries to promote an individual in establishing a small business. Under the term loan scheme, term loan will be provided to any entrepreneur belonging to the minority community. The implementation of the scheme is performed by the State Channelising Agency (SCA) which act as the nodal agency.

Eligible Activities

NMDFC supports the individual in developing self-employment ventures under the following sectors:

  • Small business
  • Agriculture and allied activities
  • Technical trades
  • Artisan and traditional occupations, and
  • Transport and services sector

Eligibility Criteria

The eligibility criteria to obtain benefits of term loan scheme are given in detail here:

  • The applicant should belong to the category of the minority community.
  • The applicant family annual income should be up to Rs.6 lakhs for rural as well as urban areas.

Note: The applicant should not avail any financial assistance under the Central Government, State Government or financial institutions relating to income-generating activities.

Quantum of Assistance

Under the Term Loan Scheme, all the eligible individuals will get a subsidy amount of up to Rs.20 lakhs for self-employment and the remaining amount has to be self-owned by the beneficiary.

Pattern of Financing

The loan will be given up to 90%, and 5% will be provided by the State Channelizing Agencies (SCAs), and the remaining 5% has to be contributed by the beneficiary. The utilization period is three months from the date of disbursement of the loan.

Rate of Interest

The rate of interest under the term loan scheme for entrepreneurs are tabulated below:

Interest Chargeable from

NMDFC to SCA3% per annum
SCA to Beneficiary6% per annum

Repayment of Loan

The amount of loan has to be repaid within five years by the beneficiaries and eight years for SCA, including the moratorium period of 6 months.

Documents Required

 The below following documents are to be submitted along with the application form of term loan:

  • Proof of identity (Aadhaar card)
  • Ration Card
  • Domicile Certificate
  • Income Certificate
  • Caste Certificate
  • Passport size Photograph of the applicant

Educational Loan Scheme

This educational loan scheme is also for the individual beneficiaries, which was proposed with an object to facilitate job-oriented education for the persons belonging to minorities. Educational loan scheme aims to provide financial assistance of up to Rs.30 lakhs for pursuing technical and professional courses.

Eligibility Criteria

The eligibility criteria to obtain benefits of educational loan scheme are given in detail here:

  • The applicant should belong to the category of the minority community.
  • The applicant family annual income should be up to Rs.6 lakhs for rural as well as urban areas.
  • The applicant must have obtained admission for any technical and professional courses approved by an appropriate agency such as Medical Council of India, UGC, AICTE etc.

Courses Covered 

All professional and technical courses at the graduate and higher level approved by the appropriate authority, as mentioned above.

Expenses Covered 

The expenses covered under the scheme are as follows:

  • Admission fee
  • Examination fee
  • Tuition fee
  • Books
  • Stationery and other instruments
  • Boarding and lodging expenses

Quantum of Assistance

 The minimum and maximum amount of loan provided under this scheme are tabulated below:

Course DetailsAmount of LoanDuration of Course
Professional and Job oriented Degree Courses in IndiaRs.30 lakhs5 years
Professional and Job oriented degree courses abroad.Rs.60 lakhs5years

 Pattern of Financing

The loan will be given up to 90%, and 5% will be provided by the State Channelizing Agencies (SCAs), and the remaining 5% has to be contributed by the beneficiary. The utilization period is three months from the date of disbursement of the loan.

Rate of Interest

The rate of interest under the educational loan scheme for beneficiaries are tabulated below:

Interest Chargeable from

NMDFC to SCA1% per annum
SCA to Beneficiary3% per annum

Repayment of Loan

The amount of loan has to be repaid within five years by the beneficiaries and five years for SCA, including the moratorium period of 6 months.

Documents Required

The below following documents are to be submitted along with the application form of educational loan:

  • Aadhaar card
  • Ration Card
  • Domicile Certificate
  • Income Certificate
  • Caste Certificate
  • Pass certificate of your last academic year.
  • Passport size Photograph of the applicant

 Micro Financing Scheme

Under Micro Financing Scheme, micro-credit is provided to the members of Self Help Groups (SHGs) in rural and urban areas for augmenting income generation activities.

The scheme envisages micro-credit to the economically weaker section of the minorities communities through NGOs and network of Self Help Groups (SHGs). Under this scheme, small loans up to Rs.1 lakh per person of SHG are provided through the SHGs or NGOs. The scheme is executed through the NGO as well as the SCAs. The funds will be allocated to the SCAs/NGOs at an interest rate of 1%, which further on-lend to the SHGs, at an interest rate not more than 7% p.a. The repayment period under the scheme is the maximum of 36 months.

To know more about Micro Financing Scheme click here

Application Procedure

 Procedure to apply for Self Employment Schemes of NMDFC is explained in detail below:

Visit Channelising Agencies (SCAs) Office

 Step 1: Eligible applicant needs to visit nearest SCA office, apply on prescribed form for Swarnima Scheme for Women.

Application Form for Self Employment Schemes 

 Step 2: Enter the necessary details in the application form and mention the needs and choice of vocation and training requirements, if any.

Upload the Documents

 Step 3: Submit your application form along with the required documents to the same SCA office.

Verification of Application

Step 4: Once the application is received by the SCA, the application will be reviewed by the concerned authority based on the details provided.

Sanction of Loan

Step 5: After reviewing the application, the loan will be sanctioned by SCA.

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