Introduction
The J&K State is famous for the weaving of specialized fabrics like Pashmina shawls, Raffal shawls, Kani shawls, Silk sarees, Kishtwari blankets, Lois, Chashme Bul Bul blankets in hilly areas of the State besides Cotton Check bed sheets and long cloth in Jammu and Kathua Districts. The handloom sector, besides being environment friendly, has enormous employment potential as it is highly labour intensive with low capital investment. .
To give boost to this Industry, the State Govt. is laying focus on product design and diversification, providing adequate credit facilities, enhancing weavers productivity through up-gradation of skills, use of efficient looms, providing market access through incentives and wide publicity.
There are 3741 handloom units in the State employing same number of persons producing Loies, Puttos, Tweed, Blankets, Raffal, Pashmina and Dusoti Khad. Integrated Handloom Development Scheme (IHDS) is a centrally sponsored scheme which is being implemented by the Department to facilitate development of cohesive, self-managing and competitive handloom units. Under the said scheme, 12 Handloom Clusters and 17 Group approach projects have been taken up at the projected cost of Rs 832.19 lakh.

Weaver Credit Card Scheme:

Objective

• The WCC Scheme aims at providing adequate and timely assistance from the Banking institutions to the weavers to meet their credit requirements i.e. for investments need as well as for working capital in a flexible and cost effective manner. The Scheme would be implemented both in rural and urban areas.

Eligibility

• All weavers and ancillary workers involved in weaving activities (including new borrowers who are otherwise eligible for credit facilities for carrying out the proposed activities under any of the existing Bank Schemes) would be eligible.
• Preference would be given to weavers identified under the Third Census of Handloom weavers conducted by Development Commissioner (Handlooms). Ministry of Textiles as well as to weavers identified by the State Governments.
• Thrust in financing would be on clusters of weavers and ancillary workers who have joined to form Primary Weavers Co-operative Societies i Self Help Groups (SHGs) / Consortia / Producer Companies / Joint Liability Groups (JLGs). While membership in such bodies would give greater comfort to banks in lending under the Scheme, bank finance will be given to weavers in their individual capacity.
• All existing weaver borrowers of the Bank enjoying credit facilities and having satisfactory dealings with the Bank will also be eligible to avail credit facilities under the Scheme for a three year period as also the benefits from simplified procedures stipulated under this Scheme for availment for such credit.

Issue of Cards
The beneficiaries under the Scheme will be issued with a Photo Weaver Credit Card (WCC) indicating sanctioned limit and validity period of credit facility. He would also be issued a passbook or a credit cum passbook, incorporating name, address, borrowing limit, validity period, etc. While the Weaver Credit Card will be used for identification, the passbook would facilitate the recording of transaction on an ongoing basis. The bank may also issue Smart Cards or any other electronic device for identification and operation of loan account, the cost for this may be borne by the Banks themselves.

Fixation of Limit

• The credit limit will be fixed based on assessment of working capital requirements as well as cost of tools and equipments required for carrying out weaving activity.
• The maximum limit to individual weavers will be up to Rs. 2 lakhs.*
• The limit is expected to be utilized as a revolving cash credit and will provide for any number of drawls and repayment within the limit. Banks may, however, fix a repayment schedule for the portion of loan availed for the purchase of tools and equipments. As the limit sanctioned would normally have a validity of three years, the need to accommodate incremental working capital requirement may be kept in view.

*Note: The working capital requirement decision would depend on the operating cycle, nature and type of yarn used for weaving, etc.

Margin
Normally no margin will be required for limits up to Rs. 25,000/-. 20% margin will be required for limits above that. However, this may vary as per guidelines of RBI from time to time and the Bank’s policy in this regard.

Validity / Renewal of Limits

• The credit card would normally be valid for 3 years subject to an annual review by the Bank.
• The review may result in continuation of the facility, enhancement of the limit or cancellation of the facility, depending upon the performance of the borrower. Need based enhancement will be considered within the overall limit of Rs. 2 lakhs for borrowers having satisfactory performance I conduct of account.
• For the purpose of annual review, the borrower may not be required to submit any financial statement.
• Based on the assessment of performance during inspection of field staff and operation in the account, the review exercise may be carried out annually and the decision on continuation or otherwise of the limits sanctioned may be taken.
• No fees will be charged at the time of review / renewal of card.

Security
The limits sanctioned will be secured by way of primary charge over the assets financed. No collateral security will be required. However, banks may obtain credit guarantee cover from CGTMSE for the limits sanctioned under the Scheme as per Bank’s policy and availability of risk cover. Insurance cover may be arranged for the assets financed as per existing practices in the Banks. The requirement of a credit guarantee cover from CGTMSE by the Banks should not be a pre-condition for issuance of a Weaver Credit Card.

Operational Details
The issuing branch would maintain the ledger account in respect of WCC accounts and all the operations in the account will normally be through this branch. Considering the nature of operations of weavers, it is expected that most of the drawings in the account would be in cash and this may be facilitated through withdrawal slips / cheques accompanied by the passbook. For units newly set up, disbursement may be made in phases based on implementation of the Scheme. However, Banks may, at their discretion, permit operations through other designated branches also, taking into account the convenience of the borrower.

Rate of Interest
Linked to Base Rate of the Bank as per RBI norms / Bank's policy.

Government Support to Handloom weavers
Based on Third National Census of Handloom Units & Allied Activity Workers, the Govt, has issued photo identity cards to Handloom Weavers and this card could serve as identity document. The Govt, has identified 550 handloom dusters containing 300 500 weavers for nurturing under Integrated Handloom Development Scheme (lHDS). Out of funds allotted for development of the clusters in many places, cash support is being offered to weavers to facilitate availment of bank loan These could be in the form o: margin money support up to Rs. 4,200/- per weaver and / or interest subsidy up to 3% on bank loans and ! or reimbursement of one time guarantee fee as applicable (1% at present) and annual service charges as applicable (0.5% at present) for a period up to 3 years payable for guarantee cover under CGTMSE. In places where margin money support is available, the same may be included in the margin money to be brought by the borrower. Information about support available from the Govt, in the form of direct financial assistance as above, marketing support, assistance in evaluating stocking needs ot the weavers etc., can be obtained from any of the following:

• Commissioner / Director (Handlooms & Textiles) in-charge in the State Government.
• Office of the Development Commissioner for Handlooms.
• Assistant Director, Handlooms or District Industries Centre in the District concerned.
• Nearest Weavers’ Service Centre of the Ministry of Textiles.
• Cluster Development Executive in respect of Handloom clusters identified under IHDS.

Monitoring of accounts
Visits to the Handloom weavers premises by field staff and review of operations in the account may be used as tools for monitoring loan accounts covered under the Scheme. Submission of stock statements and other financial statements may be waived under the Scheme.

Implementation of the Handlooms (Year wise Target and Achievements)

For more information, please visit: http://www.jkhandloomdepartment.org/

Bankwise Progress As of December 2023