THIRUVANANTHAPURAM: State’s biggest microfinance network has been devised by the Cooperative Department, in association with the Kudumbashree. The pilot project will be launched in Palakkad this week. Titled ‘Muttathe Mulla’, the project will be funded by the over 1,600 primary agricultural cooperative societies plus their 3,000-odd branches and implemented by the Kudumbashree.
Cooperation Minister Kadakampally Surendran said the project aims to free the rural population from the clutches of illegal money lenders and new generation microfinance companies.
“They are levying 24-200 per cent interest and some beneficiaries who found difficulty in repayment committed suicide,” he said.The minister said the cooperative banking sector had Rs 1.75 lakh crore deposits and hence money would not be a constraint. “PACS which do not have money will be helped by the district cooperative banks,” he said.
The scheme involves door-to-door lending and weekly collection. A sum of Rs 1,000 to Rs 25,000 will be given as loan at 12 per cent interest rate. Of this, nine per cent will go to the PACS and three for the Kudumbashree self-help group (SHG). Maximum repayment period is one year.
A Kudumbashree unit will be eligible for a cash credit loan of up to a maximum of Rs 10 lakh at 9 per cent interest rate.
The minister said the Kudumbashree should undertake the responsibility for repayment. SHGs have to enter into an agreement with the PACS.“If the repayment of a person is outstanding for three months, the loan will be transferred to the PACS and Kudumbashree is relieved of its responsibility. But if such cases exceed 20 per cent of the total amount sanctioned for the unit, its cash credit loan limit will not be renewed in future,” he said.
Chief Minister Pinarayi Vijayan will launch the pilot project of Mannarkkad Rural Service Cooperative Bank at Pazheri Convention Centre, Thenkara, Mannarkkad, Palakkad, at 2 pm on Tuesday.He will launch the government’s new tribal healthcare scheme in association with EMS Memorial Hospital, Perinthalmanna, at KILA auditorium, Agali, at 11 am.