Self Help Group

Eligible groups may be granted loan by a PACS or by a Bank branch under this scheme on the following conditions:-

a) Individual member of eligible group shall apply for loan to the group.

b) Group shall take a joint decision on each loan application on merit and it will be recorded in the Resolution Book.

c) The group affiliated to a PACS shall apply for loan in the standard format along with the copy of the resolution. The group constituted by the bank will apply directly through the bank branch. PACS can avail refinance against loan to SHG from Bank as per rule.

d) After being satisfied with the activities of the group, transaction in the account, timely deposits in savings bank account, maintenance of books and records, the PACS may grant loan not more than 6 times of the corpus fund deposited with the PACS. Similarly, the bank branch may sanction loans direct to groups. Loans sanctioned by the PACS are eligible for refinance. Initially loan should not be more than 4 times of the deposit and it should increase gradually. It is preferred that the 1st loan can be granted after 6 months of the date of deposit.

e) Inter lending is permitted in case of exigency only for a short period not more than 6 months.

f) A PACS engaged in financing SHG may apply to bank for refinance in standard format within 7 days from the date of disbursement of loan to SHG.