NABARD to refinance Rs. 800-cr. loans

National Bank for Agriculture and Rural Development (NABARD) announced a special refinance facility to support the government”s Water, Sanitisation and Hygiene (WASH) programme.

An amount of Rs 800 crore has been earmarked for this purpose for the financial year 2020-21, NABARD said in a statement.

NABARD will provide concessional refinance to all eligible financial institutions, including commercial banks, regional rural banks and cooperative banks, with a repayment period of up to 36 months.

“The support will be channelised to fund WASH activities, a thrust area eligible for 95 per cent refinance. The bank credit will also be extended to NBFCs-MFIs ( Non-Banking Financial Companies-Microfinance Institutions) and other MFIs (Societies, Trusts, etc),” it said.

Speaking on the new refinance product, NABARD Chairman G R Chintala said it will further strengthen efforts for the betterment of the rural sectors while supporting the government”s mission of ensuring sustainable and healthy lifestyle amid the COVID-19 pandemic.

“The financial institutions will be better placed to improve credit flow to the sanitation sector in rural India where vulnerable communities do not have access to WASH facilities,” he noted.

The funding will support eligible activities such as construction, repairing, enlarging of household toilets or converting an existing toilet to an accessible family toilet, domestic water motor pump, bore well/ tube well, sumps, rainwater harvesting structures, community water purifier plants and waste-water systems.

While the initiative will act as a boost to the ”Swachh Bharat Mission”, it will also encourage rural youth, small and medium enterprises and SHGs (Self Help Groups) to undertake commercial activities in the sanitisation sector, the statement said.