Jammu & Kashmir Bank has launched a specially designed product to give a boost to the small businesses that account for the bulk of the state's economy, which has been badly hit by three months of civil unrest.
Jammu & Kashmir Bank has launched a specially designed product to give a boost to the small businesses that account for the bulk of the state's economy, which has been badly hit by three months of civil unrest.
J&K Bank's Saral Finance Scheme for Small Businessmen was
unveiled by the chairman of the apex management committee of
the bank, Sudhanshu Pandey, last week, a spokesman of the bank said today.
He said the scheme provides for simple and hassle-free credit dispensation to small businessmen, traders and vendors in the state.
Small businesses play a very important role in the socio-economic development of people everywhere due to their inherent advantages like low capital requirement, high employment generation, consumption and utilisation of locally available produce, the spokesman said.
He said the bank has already started offering tailor-made financial products in areas previously known as 'un-bankable' because of the lack of collateral.
"Once given an opportunity, not only did micro-finance clients expand business and increase their income, the high repayment rates demonstrate that given a chance, the poor are capable of transforming their lives," he said.
He said the bank will not only start deploying more money in credit-starved sectors, it will also carve out more schemes for sustainable income growth and employment generation among
low-income groups.
Under the scheme, a maximum amount of Rs2 lakh shall be
provided to the borrower, which is to be repaid in five years, the spokesman said, adding that the loan bears a low interest rate of 11.25%.
The loan shall be sanctioned in the form of a working capital term loan, rather than a cash credit limit. The borrower does not need to submit any financial statements or stock statement on a monthly basis, he said.
He said the bank has also ironed out an ambitious plan to offer extensive microfinance to small entrepreneurs and will focus on demand-driven credit, building capacity for savings and insurance through small loans and financial services.
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