Lok Sabha Question No. 2261 (UNSTARRED), answered on 2025-03-12
Subject: Credit Disbursed by NMDFC
Ministry: MINORITY AFFAIRS
Asked by: Smt. Sajda Ahmed

## GOVERNMENT OF INDIA MINISTRY OF MINORITY AFFAIRS

## LOK SABHA UNSTARRED QUESTION NO- 2261

ANSWERED ON 12.03.2025

## CREDIT DISBURSED BY NMDFC

## 2261.  SMT SAJDA AHMED

Will the Minister of MINORITY AFFAIRS be pleased to state:

(a)  the  total  amount  of  credit  disbursed  by  National  Minorities  Development  and  Finance Corporation  (NMDFC)  during  in  the  last  three  years  and  the  number  of  beneficiaries  being supported;

(b) the mechanisms put in place to ensure that credit support is reaching genuine and deserving minority entrepreneurs;

(c) the details of NMDFC-funded self-employment ventures which have remained operational and sustainable after five years, State-wise;

(d) the mechanism put in place by the NMDFC to ensure timely loan repayment and prevent misuse of funds allocated for entrepreneurial ventures; and

(e) the success rate of NMDFC-funded youth startups and the measures undertaken to support them in the long run including in West Bengal?

## ANSWER

## THE MINISTER OF MINORITY AFFAIRS

## (SHRI KIREN RIJIJU)

- (a): National  Minorities  Development  and  Finance  Corporation  has  disbursed  concessional credit to the tune of Rs. 2347.15 crore during the last three years i.e., from F.Y. 2021-22 to F.Y. 2023-24, thereby providing benefits to 5,50,939 beneficiaries from minority communities.
- (b): NMDFC has following eligibility criteria for the dissemination of concessional credit:
- i. Persons should belong to a notified National Minority, specifically Buddhists, Christians, Jains, Muslims, Parsis, and Sikhs, as defined by the National Commission for Minorities Act of 1992.

ii. Person having annual family income of up to Rs. 3.00 lakhs under Credit Line-1 and up to Rs. 8.00 lakhs under Credit Line-2.

Applicants are required to submit necessary documentation to substantiate their fulfilment of the aforementioned eligibility criteria. There is a multi level screening mechanism used by respective State Channelizing Agencies (SCAs) of NMDFC, encompassing document verification, background checks,  and  site  inspections,  to  rigorously  ascertain  that  credit  support  is  effectively  reaching genuine and deserving minority entrepreneurs.

Furthermore, the sanctioned amount is released through Direct Benefit Transfer (DBT) directly into the KYC-authenticated accounts of the beneficiaries.

- (c): NMDFC  regularly  engages  independent  third-party  agencies  to  conduct  impact  studies across the country. These studies are carried out to assess the impact of NMDFC's schemes on targeted beneficiaries and evaluate the sustainability of projects and units financed under its loan programs, with respect to beneficiaries and units financed during the preceding two years. As per the study got conducted in 2018-19, 90% of the financed units across the country were found to be operational & sustainable. Most of the State Channelizing Agencies (SCAs) have reported grass root level recovery rates ranging from 70% to 100%, which in itself is testimony that these units are sustainable and profitable ventures, helping the beneficiaries in making timely repayments.
- (d): To ensure the timely utilization of funds by State Channelizing Agencies (SCAs) for lending to ultimate beneficiaries and to prevent fund misuse, NMDFC is currently charging higher penal interest from the SCAs. The SCAs are required to refund any unutilized amounts to NMDFC in order to avoid the imposition of higher penal interest. This has ensured that most SCAs disburse loans to beneficiaries within the stipulated time frame of three months.

Furthermore, to ensure timely repayment of loans, SCAs are offered a 0.5% interest rebate. This has helped NMDFC maintain a high loan repayment rate (as on February 28, 2025), of 96.26% under the Term Loan scheme and 99.33% under the Micro Finance Scheme.

- (e): As  far  as  the  National  Minorities  Development  &  Finance  Corporation  (NMDFC)  is concerned, it only implements schemes such as Term Loans, Micro Finance, Education Loans, and the  Virasat  Scheme  to  empower  youth  and  women  from  minority  communities  by  providing concessional loans for educational purposes and self-employment income generation ventures. The NMDFC schemes are implemented through State Channelizing Agencies (SCAs) nominated by respective State Governments including West Bengal, Union Territory Administrations, as well as banking partners like Punjab Gramin Bank and Canara Bank.

As per regular third-party impact study undertaken, more than 90% of the units financed are found to be operational and successful.

*****