In a significant step towards strengthening the credit delivery system and promoting the Livestock sector, the Department of Animal Husbandry & Dairying, Ministry of Fisheries, Animal Husbandry, and Dairying has introduced the Credit Guarantee Scheme under the Animal Husbandry Infrastructure Development Fund (AHIDF). This scheme aims to facilitate the smooth flow of credit to Micro, Small & Medium Enterprises (MSMEs) engaged in the Livestock sector, without the burden of collateral security.
The Credit Guarantee Scheme is designed to provide access to finance for un-served and under-served segments of the Livestock sector, with a specific focus on first-generation entrepreneurs and underprivileged sections of society. These individuals often face difficulties in obtaining financial assistance due to the lack of collateral security for their ventures.
Under the scheme, the Department of Animal Husbandry & Dairying has established a Credit Guarantee Fund Trust worth Rs. 750.00 crores. This trust will provide credit guarantee coverage of up to 25% of the credit facilities extended by eligible lending institutions to the MSMEs in the Livestock sector.
The primary objective of the Credit Guarantee Scheme is to emphasize the viability of projects, ensuring that credit facilities are secured based on the primary security of the assets being financed. By focusing on project viability, the scheme aims to promote credit access to deserving MSMEs and boost entrepreneurship in the Livestock sector. The establishment of the credit guarantee fund trust was approved as part of the Prime Minister’s AtmaNirbhar Bharat Abhiyan stimulus package of Rs. 15,000 crores, known as the “Animal Husbandry Infrastructure Development Fund” (AHIDF).
This fund incentivizes investments from individual entrepreneurs, private companies, MSMEs, Farmers Producers Organizations (FPOs), and Section 8 companies in various aspects of the Livestock sector. These include dairy processing and value addition infrastructure, meat processing and value addition infrastructure, animal feed plants, breed improvement technology, animal waste to wealth management, and veterinary vaccine and drugs manufacturing facilities.
The Credit Guarantee Fund Trust, formed in collaboration with NABSanrakshan Trustee Company Private Limited, a wholly-owned subsidiary of NABARD, marks the nation’s first-ever fund trust under the Credit Guarantee Scheme of AHIDF in the agriculture and animal husbandry sector. This groundbreaking initiative is expected to significantly increase the number of MSMEs benefiting from the AHIDF scheme and enhance the ecosystem for collateral-free credit from banks.
To ensure efficient management and execution, a credit guarantee portal has been developed as a rule-based B2B portal. The portal will facilitate the enrollment of eligible lending institutions under the Credit Guarantee Scheme, issuance/renewal of Credit Guarantee Cover, and settlement of claims.
Key Features of AHIDF Scheme:
- Interest Subvention of 3%
- Loan up to 90% of the total project cost from any Scheduled Bank, National Cooperative Development Corporation (NCDC).
This scheme is a crucial step towards boosting the Livestock sector, empowering entrepreneurs, and uplifting the rural economy by ensuring easier access to credit and financial assistance for Livestock-related ventures. For more information, interested parties can visit the official websites of the Department of Animal Husbandry & Dairying and the AHIDF scheme.