TIIC NEW INITIATIVE TO ASSIST ‘BELOW POVERTY LINE ENTREPRENEURS’
Posted on: 17/Sep/2010 12:39:33 AM
Fifteen narikuravas, an owner of a road-side fast food eatery, a 70-year-old lady and several others have been transformed into first generation entrepreneurs by Tamil Nadu Industrial Investment Corporation (TIIC) through its Grow an Entrepreneur Scheme (GES).
The scheme, which was launched about ten months ago, provides finance to those below the poverty line on liberal terms, without insisting on margin money, collateral security and personal guarantee. The promoter should be introduced by a mentor, who will undertake to guide the former in implementation of the venture and encourage him to repay the loan promptly.
On Thursday, about 10 beneficiaries narrated their ordeal in getting bank loans for their respective projects, while some of them said that they were afraid to visit banks without any collateral or security. However, it was a red carpet welcome for them at TIIC as loans were offered within 15 days on easy terms.
Loans ranging from Rs.30, 000 to Rs.5 lakh were offered to the candidates and TIIC has set aside Rs.50 crore for the current year.
Talking to reporters, TIIC Chairperson, Sheela Rani Chunkath said that their idea was to make people below the poverty line to become entrepreneurs and to lead a comfortable life. So far, 500 persons have been benefitted by this scheme and the repayment was 100 per cent. Having identified 1,000 applicants, TIIC target was to help at least 6,500 candidates over the next six months.
“Since our aim is to help micro, small and medium enterprises we need special line of credit at the rate of 5 per cent to 6 per cent per annum and have written to the authorities concerned. Currently, we are getting funds from nationalized banks at 8 per cent and SIDBI at 9 per cent. This year we plan to disburse about Rs.700 crore to Rs.800 crore,” she said.
According to her, GES is intended to cover persons without any asset back up, but having relevant qualification or experience for implementing viable projects.
TIIC would target entrepreneurs engaged in some manufacturing, service or value addition activity. The mentor should be an individual who has a good reputation and has not defaulted to any bank or financial institution. The margin money is also waived off in certain cases.
Corporate Social Responsibility
As part of Corporate Social Responsibility, TIIC donated a fish cart to a hearing impaired and mute girl; contributed Rs.50, 000 towards purchase of computers by CARE Earth for its field station at Bhavanisagar; Rs.8.35 lakh for Project Ayush; Rs.1 lakh for the shelter for the homeless project in Nagapattinam; Rs.1 lakh towards purchase of computer for the vocational training centre of a hearing impapaired school in Sivasailam and Rs.5.40 lakh for cochlear implant surgery.
“We have been performing well for the last four to five years and have brought down our accumulated loss to Rs.186 crore from Rs.300 crore. We hope to clear the losses in the next two years,” she said.
This is even though laudable initiatives, the pit falls are avoid anything with ulterior motive. The government should rather adapt straight forward which will strengthen the society such free higher education , making institutions like IIT, IIM , NIT accessible to brilliant students from below poverty category looks and liberalizing Educational loan. In most cases Educational loans sanctioned by banks for the sake of it, but making it difficult for students to draw. In one case students has been sanctioned a loan Rs 4 lakhs, which should have been sanctioned without margin money clause. Now when the student went to draw for the second year after spending for his first year education abroad, where tuition fee is free. The bank says the student can draw against bills only that too in proportion to the margin.
