The Union Minister of Consumer Affairs, Food and Public Distribution launched the Credit Guarantee Scheme for e-NWR based Pledge Financing (CGS-NPF).
About Credit Guarantee Scheme for e-NWR-Based Pledge Financing
- Objective: To facilitate easy access to post-harvest loans for farmers by leveraging e-NWRs.
- Budget Outlay: The scheme has a total corpus of ₹1,000 crore for implementation.
- Aimed at boosting post-harvest lending, targeting a total value of ₹5.5 lakh crore in the next 10 years.
- Eligible Institutions: All scheduled banks and cooperative banks can participate in the scheme.
- Key Implementation Targets Under the Scheme:
- Warehouse Registration: Increase the registration of warehouses with the Warehousing Development and Regulatory Authority (WDRA) to 40,000 within the next 1–2 years with focus on building warehouses closer to farmlands for better accessibility.
- Awareness and Technology: Promote the scheme among farmers and stakeholders and streamline lending processes through platforms like the e-Kisan Upaj Nidhi to facilitate end-to-end financing without repeated bank visits.
- Eligible Borrowers: Small and marginal farmers, women, SC/ST, Persons with Disabilities (PwD), MSMEs, traders, Farmer Producer Organizations (FPOs), and farmer cooperatives.
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| Parameter |
Details OF Credit Guarantee Scheme for e-NWR-Based Pledge Financing |
| Total Corpus |
₹1,000 Crores |
| Coverage |
Loans up to ₹75 lakhs for agricultural purposes and up to ₹200 lakhs for non-agricultural purposes. |
| Eligible Institutions |
All scheduled banks and all cooperative banks. |
| Eligible Borrowers |
Small and Marginal Farmers (SMF)
Women/SC/ST/PwD Farmers
Other farmers, MSMEs, Traders, FPOs, and Farmer Cooperatives. |
| Risks Covered |
Credit and warehouseman risk |
| Guarantee Fee |
- 0.4% p.a. for farmers
- 1% p.a. for non-farmers
|
| Guarantee Coverage |
- 85% for loans up to ₹3 lakh
- 80% for loans between ₹3 lakh and ₹75 lakh for SMF/Women/SC/ST/PwD
- 75% for other borrowers
|
About e-NWR
- Negotiable Warehouse Receipts (NWRs) were launched in 2011 by the Ministry of Consumer Affairs, Food & Public Distribution.
About Warehousing Development and Regulatory Authority (WDRA)
- The WDRA is a statutory body established under the Warehousing (Development & Regulation) Act, 2007.
- Objective: To introduce and regulate the Negotiable Warehouse Receipt (NWR) system, enabling farmers to store their produce in scientifically managed warehouses near their farms.
Key Functions OF WDRA:
- Regulating warehouses under its ambit.
- Promoting scientific storage practices to preserve produce quality.
- Enhancing supply chain efficiency and supporting post-harvest management.
|
- NWRs enable farmers to obtain loans from banks by using warehouse receipts as collateral for stored commodities.
- Negotiable warehouse receipts allow transfer of ownership of that commodity stored in a warehouse without having to deliver the physical commodity.
- Launch of e-NWR: Electronic Negotiable Warehouse Receipts (e-NWRs) were introduced in 2017 under the Warehousing (Development and Regulation) Act of 2007.
- e-NWRs provide digital records of commodities stored in WDRA-accredited warehouses and offer negotiability for various transactions.
- Uses and Integration: e-NWRs facilitate the deposit and withdrawal of commodities and enable trade transactions such as transfer and pledging.
- They are integrated with the electronic National Agriculture Market (e-NAM) platform, enabling seamless trade and ownership transfers without requiring physical delivery.
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About e-NWR Pledge Finance
- Pledging Process: Farmers or other holders of e-NWRs can pledge their warehouse receipts to obtain loans from financial institutions, using the stored commodities as collateral.Control Mechanism: When a pledge is marked, the e-NWR balances remain in the borrower’s account, but control over the balances is granted to the financial institution.
- The client cannot use the pledged e-NWR balances until the pledge is settled.
18 Dec 2024
