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What is Karnataka govt's Prerana (Micro Credit Finance) Scheme?

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ISN Team
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Prerana (Micro Credit Finance) Scheme

The Karnataka government, through Dr B.R. Ambedkar Development Corporation, has introduced the Prerana (Micro Credit Finance) Scheme to help women from Scheduled Caste and Scheduled Tribe communities establish and grow small businesses.

The primary goal of this initiative is to encourage the formation of self-help groups (SHGs) in both urban and rural areas, thereby promoting income-generating activities and fostering economic independence.

Receiving financial aid

Under the scheme, each SHG can receive a total of Rs 2.50 lakh in financial aid. This amount is divided equally among the group’s 10 members, with each member eligible for Rs 25,000. Out of this, Rs 15,000 is offered as a subsidy, and the remaining Rs 10,000 is provided as a loan at a 4% annual interest rate. 

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Participants can repay this loan over 36 monthly installments or 12 quarterly installments. In addition, the scheme extends its benefits to Scheduled Tribe women, ensuring a wider network of support for historically underserved communities.

All members are expected to share the income generated by the group’s ventures in equal measure.

To qualify, applicants must be permanent residents of Karnataka, at least 21 years old, and fall within specific annual income limits—Rs 1.50 lakh for rural areas and Rs 2 lakh for urban areas. They must also hold membership in an SHG that either rents or owns a stall or unit of at least 200 square feet.

What are the required documents?

Required documents include a caste certificate, voter ID card, an Aadhaar card, and proof of annual family income. Groups that apply must outline their business activities and pledge to use both the loan and subsidy as their primary source of finance.

The application process involves submitting these documents, along with a completed form, to the corporation for review and approval.

Prerana Scheme aims to uplift women in marginalized communities by helping them launch profitable ventures, generate sustainable incomes, and enhance their overall quality of life. 

Interested applicants can find more details and submit their applications online at: https://kmvstdcl.karnataka.gov.in/

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