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NATIONAL SCHEDULED CASTES FINANCE AND DEVELOPMENT CORPORATION (NSFDC)

Q1 What does NSFDC stand for? What is its Business Form?
NSFDC stands for National Scheduled Castes Finance and Development Corporation. NSFDC was set up on 8th February 1989 as a Company ‘not for profit’. Presently NSFDC is a Section-8 Company under the Companies Act, 2013. The mandate of NSFDC is to promote the economic empowerment of persons belonging to Scheduled Castes.
Vision : To be the leading catalyst in systematic reduction of poverty through socio-economic development of eligible Scheduled Castes living below double the poverty line, working in on efficient, responsive and collaborative manner with channelizing agencies and other development partners. Mission : Promote prosperity among Scheduled Castes by improving flow of financial assistance and through skill development & other innovative initiatives
There are two essential eligibility conditions for NSFDC loans – the applicants must belong to Scheduled Castes and their annual family income should be up to Rs.5 lakh.
NSFDC has various Credit Based & Non-Credit Based Scheme for providing financial and other assistance to the beneficiaries. Loans are provided to the beneficiaries for various economic activities under Agriculture & Allied, Small Industries and Services including Transport Sectors. NSFDC also provides loans for pursuing higher Education and vocational education & Skill Development Training Programs. Corporation provide marketing platforms for the products of beneficiaries assisted under NSFDC schemes.
During 2016-17, NSFDC signed MOU with DC handicrafts and DC handlooms, Ministry of Textiles, with an objective of Socio economic development of Scheduled caste artisans and weavers PAN India through cluster approach. Till date, NSFDC have implemented 9 cluster development programs in the State of Bihar, Rajasthan, Assam and West Bengal.
NSFDC CSR interventions enabled helping the marginalized & needy persons. NSFDC CSR activities for the year 2023-24 focused on DPE Theme ‘Health & Nutrition’. Activities include installation of Sanitary Vending Machines & Incinerators, Plastic Bottle Crushing Machines, Health Camps, Construction of Toilets & Installation of Borewell & RO plant, Solar Panels, Swachh Bharat Campaign etc. NSFDC has spent an amount of Rs. 36.44 lakhs for CSR activities during the year 2023-24 as on 31.12.23.
NSFDC adopts channel finance system wherein funds are channelized to the beneficiaries through the SCAs/CAs. There are 102 SCA/Cas of NSFDC.
State nominated State Channelizing Agencies (SCAs), Regional Rural Banks (RRBs), Public Sector Banks (PSBs), MBFC-MFIs., etc.

NORMS OF SCAS Before disbursement of funds to the SCAs, the following norms are taken into consideration:

Guarantee: Availability of adequate State Government Guarantee/Bank Guarantee/State Government Order/State Government Assurance.

Utilization Level: There should be a minimum of 100% cumulative utilization level of funds already disbursed as at the end of preceding month for disbursement till February end and cumulative fund utilization level of 100% at the end of preceding day for disbursement of fund in the month of March.

Repayment of Dues: There should not be any overdues more than one year old.

NSFDC, the Cooperative Banks (Channelizing Agencies) have to fulfill certain norms to be eligible for disbursement of funds from NSFDC. These norms are given as under:
There should not be any overdues payable to NSFDC at the time of disbursement.

There should be a minimum of 100% cumulative utilization level of funds already disbursed as at the end of preceding month for disbursement till February end and cumulative fund utilization level of 100%at the end of preceding day for disbursement of fund in the month of March, under project-based schemes. Besides above, the following conditions are to be fulfilled by the Cooperative Banks based on their Annual Accounts of the preceding financial year:

Net Non-performing Assets (NPA) of the CA(s) should be less than 5% for the preceding financial year. Or Average net NPA for the last 05 financial years should be less than 5%. Further, out of these 05 years, the net NPA of the CA(s) should be less than 5% each year, for at least 03 years. CA(s) should have 3 years of continuous profit track record. Or CA(s) should be in profit for at least any 03 out of last 05 financial years. CA(s) should not be defaulter of any Regulatory Body. Satisfactory Credit Opinion Report of funding organization in respect of the Cooperative society.

NSFDC, the NBFC-MFIs (Channelizing Agencies) have to fulfil certain norms to be eligible for disbursement of funds from NSFDC. These norms are given as under:
 No pending utilization of NSFDC funds for more than one year at the end of the preceding financial year.
 There should be a minimum of 80% cumulative utilization level of funds already disbursed as at the end of preceding month for disbursement till February end and cumulative fund utilization level of 80% at the end of preceding day for disbursement of fund in the month of March.
 No overdues payable to NSFDC at the time of disbursement.
 The disbursement to NBFC-MFIs shall be subject to Security.
 Under Cluster Mode, Guarantee from Public Sector Bank (PSB) equivalent to the amount to be disbursed or 50% in the form of Post Dated Cheques (PDCs) and 50% Fixed Deposit from PSB. One undated PDC equivalent to the 50% of amount to be disbursed.  Under Non-Cluster Mode, Guarantee/Fixed Deposit from Public Sector Bank equivalent to the amount to be disbursed or up to 50% in the form of mortgage of Residential/Commercial property alongwith Personal/ Corporate Guarantee of respective property owner(s) and remaining as Guarantee/Fixed Deposit from PSB.

As on date, the Authorized share Capital is Rs. 1800 crore and Paid-up share capital
of NSFDC is Rs. 1515.00 crore.

NSFDC was incorporated on 08.02.1989 as a Company ‘not for profit’ under Section-25 of Companies Act, 1956. Consequent upon the introduction of the Companies Act, 2013, NSFDC is now a Section-8 Company (not for profit) under the new Act.
NSFDC is a Schedule ‘C’ Central Public Sector Enterprises under the Administrative Ministry of Social Justice & Empowerment and wholly owned by the Government of India.

To finance income generating schemes of eligible Scheduled Caste persons through State Channelizing Agencies (SCAs) nominated by the State Governments/UT Administration and other Channelizing Agencies (CAs).
 Improvement in flow of financial assistance to persons belonging to Scheduled Castes for their economic well-being
To provide Educational Loans to target group through SCAs and or CAs for pursuing full-time professional/technical education through recognized institutions in India and abroad.
 To provide grants for Skill Development Training Programmes of the target group.  To organize/participate in the Exhibitions cum Fairs for marketing of the products of beneficiaries.

1) The beneficiary(ies) should be from the Scheduled Caste Community.
2) Individuals, Partnership Firms and Co-operative Societies are eligible to undertake income generating activities. However, proposals submitted by Partnership Firms and Co-operative Societies shall be considered subject to the following:
 (a) All the members of Partnership Firms/Co-operative Societies belong to Scheduled Caste community
 (b) Annual family income of each member/applicant should not exceed Rs.3.00 lakh. Note: Applicants are required to apply for financial assistance from NSFDC through the concerned State Channelizing Agencies (SCAs)/Channelizing Agencies (CAs). Direct contact or correspondence by the Applicants/Beneficiaries shall not be entertained by NSFDC under any circumstances.
3) Annual family income of the applicants should be within Rs.3.00 lakhs (for both rural and urban areas w.e.f. 08.03.2018) under Credit Based Schemes.

There is no income criterion under Skill Development Training Programmes.

NSFDC promotes market facilities for the artisans assisted under the NSFDC loan schemes by providing opportunities to participate in fairs like India International Trade Fair, Dilli Haat, SurajKund International Craft Mela as, Shilp samagam well as exhibitions in their respective states. It gives market exposure to artisans, provide opportunity to market their products at good price and helps them in establishing, market linkages.

NSFDC provides Micro Finance Scheme for units costing up to Rs.1,40,000/-. Maximum Loan Limit: NSFDC provides loans up to 90% of the Project Cost with maximum amount of Rs.1.25 lakhs. Rate of Interest: The NSFDC shall charge interest @ 2.5% from the SCAs/CAs, which in turn, shall charge 6.5% from the Beneficiaries. Repayment Period: The loan under the Scheme is to be repaid in quarterlyinstalments within a maximum period of three years from the date of disbursement including 3 months moratorium period.

Under this scheme, beneficiaries can obtain loan for project(s)/unit(s) costing from Rs. 1.40 lakh to Rs. 50.00 lakhs. Maximum Loan Limit: NSFDC provides loans up to 90% of the Project Cost, i.e. >Rs.1.25 lakh and upto Rs. 45.00 lakhs per unit. Rate of Interest: NSFDC shall charge interest @ 4% from the SCAs/CAs, which in turn, shall charge 8% from the Beneficiaries. Repayment Period: Term Loan is to be repaid in quarterly/half yearly instalments, within a maximum period of 7 years including 6 moratorium period (except for plantation and construction activities for which it will be 12 months).

Under Education Loan Scheme, loan is provided for pursuing full-time Professional/Technical courses in recognized institutions as one time assistance. The Educational Loan shall cover Admission Fee, Tuition Fee, Books, Stationery, Equipment, Examination Fee, Hostel and Mess Expenses, Insurance Premium for Policy for insuring loanees against loan in case of death or permanent disability, Travel Expenses/Passage Money including Visa Expenses for studying abroad, Caution Money, Development Fund, Clothing Allowance including weather protective clothing in extreme climate (in case of foreign study). Maximum Loan Limit: Up to Rs.40.00 lakh for studies in India and Abroad or 90% of course fee, whichever is less. Rate of Interest: NSFDC shall charge interest @ 2.5% from the SCAs/CAs, which in turn, shall charge 6.5% from the Beneficiaries Repayment Period: The maximum repayment period under the Educational Loan Scheme is as under:- Upto 12 years were repayment has not stared and upto 10 years were loan disburse and repayment stared.

To provide prompt and need based micro finance to eligible scheduled caste persons at reasonable rate of interest through NBFC-MFIs to pursue small/micro business activities. Maximum Loan Limit: NSFDC provides loan up to 90% i.e. up to Rs. 1.25 lakhs for projects costing up to Rs. 1.40 lakhs Rate of Interest: The NSFDC shall charge interest @ 5 % from the NBFCMFIs, which in turn, shall charge 15% from the Beneficiaries Repayment Period: The loan is to be repaid in quarterly instalments within a maximum period of 3 years from the date of each disbursement including 3 months moratorium period.

NSFDC provides loan under Udyam Nidhi Yojana (UNY) for project(s)/unit(s) costing up to Rs.5.00 lakhs. Under this scheme, loans are provided through Cooperative Societies and Cooperative Banks (Channelizing Agency) to pursue small/micro activities as per the beneficiaries’ needs. Maximum Loan Limit: NSFDC provides loans up to 90% of the Project Cost i.e. up to Rs. 4.50 lakhs. Rate of Interest: The NSFDC shall charge interest @ 5 % from Cooperative Societies and Cooperative Banks, which in turn, shall charge 13% from the Beneficiaries. Repayment Period: The loan under the Yojana is to be repaid in quarterly/half-yearly instalments, within a maximum period of 5 years including 3 months moratorium period.

DETAILS OF VARIOUS SCHEMES BEING IMPLEMENTED BY NSFDC

Scheme Project Cost Maximum Loan Limit
(Up to 90% of Project Cost)		 Interest Rate p.a. Repayment Period Moratorium Period
SCHEMES TO BE IMPLEMENTED THROUGH SCAs / PSBs / RRBs
Micro Finance Scheme Up to Rs.1.40 lakh Up to Rs.1.25 lakh CAs: 2.5%
Beneficiary: 6.5% 		Within 3 years 3 months
Term Loan > Rs.1.40 lakh & up to Rs.50.00 lakh > Rs.1.25 lakh & up to Rs.45.00 lakh CAs: 4%
Beneficiary: 8% 		Within 7 years 6 months (except plantation & construction – 12 months)
EDUCATION LOAN
Educational Loan Scheme (ELS) Up to Rs.40.00 Lakh or 90% of course fee (Domestic & Abroad) Up to 90% of project/course fee CAs: 2.5%
Beneficiary: 6.5% 		For new loans (repayment not started): up to 12 years
For refinance loans (repayment started): up to 10 years 		New loans: Course Period + 1 year
Refinance loans: Up to 6 months
SCHEME THROUGH NBFC-MFIs
Aajeevika Microfinance Yojana (AMY) Up to Rs.1.40 lakh Rs.1.25 lakh CAs: 5%
Beneficiary: 15% 		Within 3 years 3 months
SCHEME THROUGH CO-OPERATIVE SOCIETIES / BANKS
Udyam Nidhi Yojana (UNY) Up to Rs.5.00 lakh Rs.4.50 lakh CAs: 5%
Beneficiary: 13% 		Within 5 years 3 months
SKILL DEVELOPMENT TRAINING PROGRAMMES
100% grant to the Training Institute and stipend @ Rs.1500/month per trainee (80% attendance). Boarding & lodging as per norms for residential training.