Solution

The Department of Animal Husbandry & Dairying, Ministry of Fisheries, Animal Husbandry, and Dairying (DAHD) has introduced the ‘Credit Guarantee Scheme’ under the Animal Husbandry Infrastructure Development Fund (AHIDF) to support the Livestock sector's Micro, Small & Medium Enterprises (MSMEs) without the need for collateral security. Objectives of Scheme- o The scheme aims to strengthen the credit delivery system and ensure smooth access to finance for entrepreneurs engaged in the Livestock sector. o The main objective is to encourage lenders to focus on the viability of projects and provide credit facilities based on the primary security of the assets being financed. By providing access to financial assistance, it promotes investments in various areas of the livestock sector, such as dairy and meat processing, animal feed plants, breed improvement technology, waste management, and veterinary vaccine and drug manufacturing facilities. o With this scheme, the participation of MSMEs in the Livestock sector is expected to increase, leading to improved credit flow and bolstering the overall rural economy. o The DAHD has set up a credit guarantee fund trust of Rs 750 crore, which will cover up to 25 per cent of credit facilities extended to eligible MSMEs by lending institutions. o The trust, formed in partnership with NAB Sanrakshan Trustee Company Private Ltd, a subsidiary of NABARD, ensures credit guarantees for MSMEs under the AHIDF scheme. This initiative enhances the number of MSME units benefiting from the AHIDF scheme and strengthens the ecosystem for collateral-free credit from banks. Key features include: o Interest subvention of three per cent o Loan of up to 90 percent of the total project cost from any Scheduled Bank, National Cooperative Development Corporation (NCDC).