Concessional Credit Scheme for Handloom Sector

Individual handloom weavers, weaving groups, clusters, and registered handloom cooperatives are eligible. Applicants must be engaged in handloom production and have valid identification. Self-employed artisans and producers of traditional handloom products can also apply.

The scheme offers concessional interest rates lower than standard commercial loans, typically ranging from 4-7% depending on bank policies and borrower category. Repayment periods range from 3-7 years with flexible monthly installment options suitable for artisanal business cycles.

Loans can be utilized for working capital to purchase raw materials, wages, and inventory; purchase of equipment and machinery; shed construction or renovation; and modernization of handloom units. The loan amount is determined based on business requirements and repayment capacity.

For loans up to Rs. 10 lakh, collateral may not be required or minimal collateral is needed. Banks may accept group guarantee or personal guarantees from group members for cooperative lending, promoting financial inclusion for weaker sections.

Contact the nearest bank participating in the scheme or your handloom cooperative. Submit required documents including identity proof, business registration, bank statements, and project details. The bank will process your application under priority sector lending norms.