The Central Perks of Coir Udyami Yojana: Startup India

Coir Udyami Yojana is a credit-linked subsidy based scheme that helps entrepreneurs set up coir manufacturing units for the maximum project cost up to Rs. 10 lakh. The Government of India has approved this scheme to facilitate the sustainable development of the country’s coir industry. The main aim behind the plan is to generate more employment, especially for women and weaker sections of the society.

Coir Udyami Yojana is a tool to enhance the MSME sector to contribute in a better way towards India’s economy. MSME or micro-units is the backbone of our Indian economy, requires improving tools to make them prosper and for the better growth of the economy. Coir Udyami Yojna acts as an effective instrument contributing to an advanced economy. 

Coir Udyami Yojana (Introduction)

Coir Udyami Yojana is a scheme administered by the Ministry of Micro, small and medium enterprises. The coir board implements the scheme under the Ministry of MSME. The plan aims to develop the coir-related industry’s sustainable development and is under the ambit of MSME. However, the maximum permissible project cost is limited to INR 10 lakhs, which shall not exceed 25% of the project cost. The banks shall consider a composite loan instead of the term loan to cater to working capital requirements, which should be exclusive of the Rs.10 lakhs limit proposed. The start-up businessmen who are interested in establishing the coir manufacturing unit can avail of the benefit of this scheme. They can also apply to any coir board of the state or designated institute by the coir board.

Objectives of the Scheme

The main objectives of the Coir Udyami Yojana include:

• To make efforts to modernize the coir Industry by the adoption of modern technology in the production or processing of coir and its products;
• The Coir Udyami Yojana aims to upgrade the current production and processing technologies to improve the productivity, quality, and diversification of the product.
• The Coir Udyami Yojana aims to increase the efficiency and productivity of various business units to enhance the workers’ earnings engaged in the current sector.
• The Coir Udyami Yojana aims to increase the production of coir products and coir fiber.
• Coir Udyami Yojana tries to generate maximum employment in the rural areas of the states/UT’s producing coconut.
• The Coir Udyami Yojana employs women entrepreneurs in rural areas for gender empowerment.
• The Coir Udyami Yojana stabilizes the socio-economic conditions of the workers involved in the industry.
• The Coir Udyami Yojana contributes to the inclusive growth of the vulnerable sections of beneficiaries, especially Scheduled Castes (SC), Scheduled Tribes (ST), and people belonging to the North Eastern Region (NER).
• Coir Udyami Yojana provides efficient training and workshops for the youths who are attracted to the coir industry. 
• The Coir Udyami Yojana acts as a backward/forward link to the unitholders assisted under the scheme. 

Eligibility Conditions under the Coir Udyami Yojana Scheme

• Any individual who has crossed 18 years of age with Indian Citizenship
• There won’t be having any income ceiling for assistance for bringing up the projects under the Coir Udyami scheme.
• Assistance under the Coir Udyami Yojana scheme is solely available for projects related to the production of coir fibre /products/yarn etc. Coming under the coir sector
• Aid under the Scheme will be made available to Self Help Groups, individuals, Companies, Non-Governmental Organizations, Production Co-operative Societies, Institutions registered under Societies Registration Act 1860, Joint Liability Groups, and Charitable Trust. Nonetheless, the units that have availed government subsidy under any different Scheme of Indian government or State Govt. for a similar purpose doesn’t fulfill the eligibility criteria to claim subsidy under the Coir Udyami Yojana.

Financial Assistance

The Coir Udyami Yojana offers financial support for projects: 

• The project’s maximum permissible cost is limited INR 10 lakhs plus working capital, which shall not exceed 25% of the project cost.
• Bank credit of up to 55% of the project cost.
• 40% of the project cost as subsidy from the Govt. of India.
• Working capital is not considered for a subsidy, and the beneficiary’s contribution should be 5% of the project cost.
• The banks may consider a composite loan instead of a term loan to cater to the working capital requirements.

Features and Advantages of Coir Udyami Yojana

• The Coir Udyami Yojana is commenced by the Central government to set micro and small level coir units throughout the geographical boundaries of India.
• Under the Coir Udyami scheme, the maximum cost of a coir project is up to Rs. 10 lakh in which the working capital cost is not encompassed in the value of the project.
• The project’s cost plus one working capital cycle must not be more than 25% of the project cost.
• Initially, only 5% of the cost of the project should get paid by the applicant,
• The applicant can get the benefit of the 40% subsidy from the side of the government of the project cost.
• Besides this, a Balance of 55% of the cost of the project is bestowed in the structure of a loan at the concessional terms.
• The entire project cost wraps every kind of capital purchases. Nonetheless, working capital is not deemed for the loan and subsidy Companies, Self-Help Group, Registered Society, Individuals, NGOs, Production Co-Operative Society, and Charitable Trust may apply for the Coir Udyami scheme.

Coir Udyami Yojana Apply Online- Application Procedure

Applying for the Coir Udyami Yojana is very simple and sorted. One can avail the application form from any of the below-mentioned offices:

The correctly filled application form and all the necessary documents must be submitted to the Coir Board field offices or District Industrial Centre. One can also easily apply for the CUY scheme online by visiting its official website. After choosing the scheme and clicking on the ‘Apply online’ option. You will see a login window that requires login details. If you are not a registered user, then click on ‘New Login Registration.’ After that, you need to enter necessary details like full name, mobile number, email ID, Aadhar number, and security question and user name as per your preference. At last, you can click on ‘Confirm’ to complete the registration process.

Criteria for Beneficiary Selection under Coir Udyami Yojana

• The beneficiary selection will take place on the worth on a ‘first-come-first-served’ basis.
• Entrepreneurship Development Programme will be compulsory for all beneficiaries of the Coir Udyami Yojana scheme.
• The applicants need to undergo EDP training either before applying for Coir Udyami Yojana or post-submission of the application but prior to the Regional Level Selection Committee endorses the applicants to the Bank. A certificate to the outcome that the beneficiary has gone through the training has to be encircled together with the application while it is suggesting to the banks for consideration.
• At the Coir Board, the officer-in-charge of the Field Office will examine the applications. Moreover, the applications which are finished in all respects will be positioned before the Regional Level Selection Committee.
• The scrutinization of the application will take place from the roof of the Regional Level Selection Committee based on experience, viability, and capability of the projects and further interview the applicants to inspect their knowledge regarding the proposed project, skill, aptitude, interest, and entrepreneurship capacities, market access, virtue to repay and give rise to the proposed project in order to make it successful.
• Thereafter, the chosen applications will be delivered to the Banks.
• On the viability of all the projects, the banks will make their own decision.
• No collateral securities will be pressed for by the banks in line with the RBI guidelines for projects insulated in the CGTF Scheme.
• If the banks reject the applications, the reasons for the rejection must get furnished by the banks in the form of writing to the Coir Board Field Office as well as the applicants concerned.

Selection of Beneficiary

• The Regional Level Selection Committee must hold a quarterly meeting with the banks to evaluate the status of the project plans. Wherever the projects were repudiated,
• Shortcomings/reasons must get furnished by the banks to the Coir Board & applicants involved.
• Since the representatives of the banks will also be a Selection Committee member, it has to be assured that the maximum number of projects and undertakings cleared by the Selection Committee is consented by the banks. The selection committee will also assess the performance of the banks as well as the status of loan recovery and repayment in the quarterly meetings for reviews.
• Once the Coir Board Field Office obtains the project proposals, the elements of such proposals should get furnished in the web-based application tracking system with a distinct registration number for each beneficiary to facilitate the entrepreneurs to track the status of their application at any point in time.
• Till then, the e-tracking system will be entirely operational (for which listed guidelines should be circulated by Coir Board individually to the Field Offices). This aggregated data concerning the progress and advancement of each application support availed by beneficiaries pertaining to special categories (level wise), employment details, etc., will be upheld by the Field Offices & data will be harmonized by the Head Office of Coir Board.
• The status of reconciliation will also be evaluated by the Selection Committee in the meetings of the Selection Committee and by the Chairman of the Coir Board in the review meetings.
•  The First loan installment will be discharged to the beneficiary only after the EDP training specially formulated by Coir Board for the purpose that will be governed by its Field Offices.

Further Steps

• The components of the sanction attained from the Banks will be published to the Head Office of the Coir Board by the Field Offices & Head Office will be depositing lump-sum subsidy in the Account( Savings Bank Account) in the name of Coir Board in the Nodal Branch of the respective Bank.
• The beneficiary must go for depositing his contribution to the concerned Bank in the time frame of 30 days of the receipt of a sanction letter copy from the Bank.
• The competent subsidy for the approved project will be disclosed by the Nodal Bank after reaping the authorized confirmation from the Implementing Bank that the loan’s 1st installment has been released to a definite beneficiary based on the projections of Capital Expenditure in the undertaking report. The Banks won’t be charging interest on the loan to the dimension of subsidy number from the aggregate loan.
• Though banks will claim subsidy on the ground of Capital Expenditure projections in the project report & authorization thereof, subsidy proportionate on the real availment of Capital Expenditure will be maintained, and abundance, if any, will be paid back to Coir Board, instantly after the project is ready for the outset of production. However, the subsidy will be discharged by the appointed Nodal Branch of the Bank, Coir Board, will be the ultimate authority to approve or dismiss a claim/project based on the Udyami Yojana scheme’s parameters.
• Meticulous grounds for rejection should get documented and retained by Coir Board.
• After the Margin Money gets discharged in favor of the beneficiary, it must be kept in the Receipt of Term Deposit of two years at the branch phase in the name of the beneficiary.

Beneficiary Selection Criteria- Final Steps

•  No interest would get paid on the TDR, along no interest would get charged on loan to the interrelated amount of TDR.
• Since the Margin Money is to be furnished in the subsidy form (grant), it would get credited to the loan account of the beneficiary after the duration of two years from the date of the first disbursement to the beneficiary by the Bank.
• In case any retrieval is effected henceforth by the Bank from any reference whatsoever, such recovery would get used by the Bank for the purpose of liquidating their outstanding dues on priority.
• The subsidy will be ‘one-time assistance’ from the end of the Government. For any

Up-gradation of the credit limit or for modernization/expansion of the project, Margin Money assistance is unavailable.

• Bank has to acquire a feat from the beneficiary prior to the release of Term Loan that, in the incident of objection by Coir Board, the beneficiary will pay back the Margin Money kept in the TDR or discharged after two years.
• On a quarterly basis, the Nodal Bank must render accounts to the Coir Udyami Board on reconciliation of the lump sum Margin amount placed with them implying the branch wise elements of the total number of units helped, investment accrued, Margin Money permissible, Margin Money (subsidy) reimbursement due to Coir Board, etc. The consolidated statement must be supported by the loanee wise details submitted by each branch.
• Final subsidy adjustment will be made after the photograph of the unit would get updated as well as the beneficiary has been uploaded on the e-tracking system after mutual physical validation by the Coir Board & Bank allotment to the beneficiary by the Bank.

Awareness Camps

Coir Board will operate awareness camps in those states that produce coconut to enhance the popularity of Coir Udyami Yojana and to enlighten conceivable beneficiaries with respect to the Scheme. The awareness camps will encompass participation from men as well as women, immersed in the coir sector, with a unique emphasis on special category, i.e., Minorities, SC, ST, OBC, Women, etc. The essential details in this regard will be attained by the Coir Board from DICs along with State Level organizations like

SC/ST Corporation, NGOs having a reputation, Nodal Agencies, and more. From the awareness camp, the beneficiaries would get shortlisted and propelled for training.

Required Activities to be embarked in the Awareness Camps

• Presentation of the Coir Udyami Yojana by Coir Board official Members
• Publicity via posters, press advertisements in local newspapers, banners, etc.
• Press Conference
• Presentation by the prosperous Coir Udyami Yojana entrepreneurs
• Presentation by Lead Bank of the region
• Data gathering from the potential beneficiaries will comprise information like beneficiary profile, a skill acquired, background and qualification, experience, eagerness towards the project, etc.
• A shelf of undertakings in coir related activities organized by the Coir Board will be disseminated for contemplation under Coir Udyami Yojana to the implementing Board offices, DICs, Banks, etc. Also, the inclusion of the projects will be made by the Board in consultation with Banks, DICs, as well as other stakeholders. The beneficiary would have the liberty to develop coir projects as per their provisions. The projects readied by the beneficiaries would get considered after evaluating the project’s viability.
• Marketing assistance for the products of Coir Udyami Yojana units via the marketing outlets of the Coir Board can be furnished as far as possible. The right to deliver such support on the basis of pricing, quality and other parameters from time to time lies in the hands of Coir Board reserves.

Take Away

As an Aatmnirbhar Sena, we provide round the clock assistance to the MSMEs who are willing to get attached to the coir industry to bring glory to the sector with their contribution. We are conducting seminars and workshops to make more people vigilant about the coir industry and its contribution to India’s economy. India’s government is already hitting all parameters of providing aid and assistance to the coir industry under Coir Udyami Yojana. As their parallel line, we are also organizing professional workshops for the budding entrepreneurs to attract youths for the current industry and make them avail of all the benefits prescribed under the scheme.