Tips for Field Worker s Vol 2 - Vanbandhu Kalyan Yojana

Tips for Field Workers
d) An individual SHG can obtain assistance from the
fund only once. It is expected that after completing
one such loan cycle, the NGO would ensure that the
group is linked with a Bank or RMK for its future
credit needs.
Other terms and conditions for revolving fund loans
Interest Rates
The NGO will charge from the SHGs interest at the rate of
12 per cent per year on the outstanding loan;
The SHGs will take their own decisions to charge interest
from the members and the decision, once taken, will be
applied uniformly to all borrowing members.
Purposes for which the loan is given
Neither the Corporation, nor the implementing NGO,
should place any conditions on the type of activity to be
funded from these loans. This decision should be left to
the SHG. They must be free to decide the type of activity,
whether income generating or otherwise, that they want to
assist.
Repayments
The SHG will repay the loan and interest to the NGO in
equal monthly instalments, starting from the second month
after which it received the loan.
Penal Interest
In case of default or a delayed repayment, the NGO may
charge a penal interest at the rate of one
per cent per month from the SHG for the
period of default or delay.
Merger of Loans with the Group’s Own
Savings
The group will pool the Revolving Fund
loan from the NGO with its other savings
and use the total amount (loan and
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