Lok Sabha Question No. 2144 (UNSTARRED), answered on 2018-01-01
Subject: Repayment of Loans provided by NSDC
Ministry: SKILL DEVELOPMENT AND ENTREPRENEURSHIP
Asked by: RAVNEET SINGH

## GOVERNMENT OF INDIA MINISTRY OF SKILL DEVELOPMENT AND ENTREPRENEURSHIP

## LOK SABHA

## UNSTARRED QUESTION NO. 2144 TO BE ANSWERED ON 01.01.2018

## REPAYMENT OF LOANS PROVIDED BY NSDC

## 2144. SHRI RAVNEET SINGH

## Will  the  Minister  of  SKILL  DEVELOPMENT  AND  ENTREPRENEURSHIP  be pleased to state :

- (a) the policy of the Government to evaluate the applicants of private trainers/ training partners  (TPs)  under  the  Pradhan  Mantri  Kaushal  Vikas  Yojana  (PMKVY)  before extending the credit facility;
- (b) whether the Government is monitoring the status of repayment of loans provided by the National Skill Development Corporation (NSDC) and if so, the details thereof;
- (c) whether the Government has identified the value of loans that have turned bad and if so, the details thereof; and
- (d) whether any action has been taken against those who have been found responsible for non-repayment of the loans and if so, the details thereof?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF SKILL DEVELOPMENT AND ENTREPRENEURSHIP (SHRI ANANTKUMAR HEGDE)

- (a) Under the Pradhan Mantri Kaushal Vikas Yojana (PMKVY), there are no provisions for  providing  credit  facility  to  private  trainers/  training  partners  (TPs).  However,  National Skill  Development  Corporation  (NSDC)  invites  proposals  from  interested  entities  for affiliation  as  funded  Training  Partner  -  for  financing  of  projects  that  are  commercially viable, scalable and sustainable.

The salient features of affiliation and eligibility criteria are mentioned below:

| Parameter                   | NSDC Funding Guideline                                                                                                                                  |
|-----------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------|
| Eligibility                 | Any legal entity including, but not limited, to Company/ Society / Trust as per the process and applicable laws and guidelines                          |
|                             | What Gets Funded Total investment requirement towards - • Training Infrastructure (excluding the acquisition/creation of immovables); • Working Capital |
| Interest Rate               | 6% p.a.                                                                                                                                                 |
| Principal Moratorium Period | Up to 3 years                                                                                                                                           |
| Interest Moratorium         | NIL                                                                                                                                                     |

| Period                         |                                                                                                                                         |                                                                                                                                                                                                                                                                                          |                                                                                                                                         |
|--------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------|
| Repayment Period               | 7 years (including moratorium period)                                                                                                   | 7 years (including moratorium period)                                                                                                                                                                                                                                                    | 7 years (including moratorium period)                                                                                                   |
| Promoters Contribution         | • Minimum 15% of the investment requirement (not-for-profit entities) • Minimum 25% of the investment requirement (for-profit entities) | • Minimum 15% of the investment requirement (not-for-profit entities) • Minimum 25% of the investment requirement (for-profit entities)                                                                                                                                                  | • Minimum 15% of the investment requirement (not-for-profit entities) • Minimum 25% of the investment requirement (for-profit entities) |
| Training Commitment            | Standard Proposals                                                                                                                      | Corporates - Listed in BSE/NSE for more than 3 years with a credit rating of A- or above or foundations/similar ventures                                                                                                                                                                 | Private Universities, Engineering Colleges, ITI, Polytechnics                                                                           |
| Proposals 20,000 persons       | Standard over 7 years                                                                                                                   | Corporates - Listed in BSE/NSE for more than 3 years with a credit rating of A- or above or foundations/similar ventures of such organisations 5,000 persons per centre over 7 years Private Universities, Engineering Colleges, ITI, Polytechnics 5,000 persons per centre over 7 years | Training Commitment                                                                                                                     |
| Placement Guarantee Commitment | At least 70%                                                                                                                            | At least 70%                                                                                                                                                                                                                                                                             | At least 70%                                                                                                                            |

(b) Government  is  monitoring  the  repayment  of  loans  provided  by  NSDC  through seeking  regular  updates  and  reports  from  NSDC.  Further,  government  has  appointed independent monitoring agency (SBI Caps) to monitor the repayment of loans extended by NSDC on a quarterly basis.

(c) As of  30 th November 2017, 31 loan accounts  are  classified  as  NPA  (20  accounts under  Doubtful  category  and  11  accounts  under  Sub-Standard  category),  with  a  total overdue amount of INR 78.54 crores. Adequate provision has been accounted for in the books of accounts. However, none of the loans have been classified as Loss Assets.

(d) In  order  to  effectively  manage  the  Loan  Portfolio  and  closely  review  NPA  and Stressed  partners  (including  restructuring  requests),  NSDC  has  constituted  an  Internal Committee  comprising  of  senior  representatives  from  NSDC  Management.  Further,  in order to effectively manage such accounts, one-to-one meetings were conducted with the top management of NPA Training Partners to understand their concerns and assess the future plans for repayment of outstanding loan amount. On basis of the discussions held with  Partners and evaluation by the Committee, suitable corrective action plan including Initiation of Recovery Process, Proposal Restructuring and Limiting of Loan exposure has been initiated. Further steps being taken to ensure regular reporting of repayment history to CIBIL and regular follow up is being done for recovery of dues.

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