The Hindu Business Line : Rural NGOs seek revolving cash credit from Nabard

THE apex body for rural NGOs has forwarded a wish-list to the Union Finance Minister, Mr P. Chidambaram, pleading for a host of beneficial schemes to the sector, given that the Common Minimum Programme of the UPA Government sets store by agriculture and rural development as integral to inclusive growth strategy.

In a joint memorandum to the Finance Minister, Mr Mohan Dharia, Chairman of the Confederation of NGOs of Rural India (CNRI), and Mr L.V. Saptharishi, co-Chairman, have placed three suggestions.

One is a revolving cash credit limit of a sum of Rs 5 lakh from Nabard, SIDBI, or any of the public sector commercial banks for meeting the capital needs of each of the rural NGOs with sound track record and credentials.

CNRI represents the interests of around 2,000 NGOs working in rural areas through its 25 State chapters.

They said that a large number of small NGOs at the grassroots level do not have access to adequate funding as they depend only on project funding.

When such funding gets delayed or dried up, they have to use personal funds to keep the establishment going.

Hence, introduction of revolving credit would ease their working capital problems.

Secondly, they said that enabling rural NGOs to establish brand image and equity for their products by having access to Brand Equity Fund through Nabard, SIDBI, or public sector commercial banks would go a long way in promoting rural products as a large number of NGOs are working with several self-help groups (SHGs).

CNRI as the networking and facilitating body could be associated with the operation of this fund on the lines to be decided by the financial institutions and public sector commercial banks, they added.

Thirdly, they sought exemption from payment of service tax particularly when NGOs activities centre round rural activities for the benefit of the poor and the vulnerable sections.

In the absence of any such exemption under due notification, the rural NGO sector is finding the going difficult, they said.

Meanwhile, Mr Saptharishi told Business Line that CNRI has announced the setting up of CNRI-Shops all across the country for marketing of NGO/SHG products.

A design is on the anvil for the CNRI-Shop, which would be used by member NGOs and franchisees keen on setting up the shop.

He said that this arrangement would pave the way for marketing of the rural products with CNRI brand, adding that CNRI State Chapters of Tamil Nadu, Haryana, Delhi, West Bengal, and Uttar Pradesh have evinced interest in this venture.

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