Context:

• Himachal Pradesh government has introduced the Empowered Women Loan Scheme, a pioneering initiative aimed at empowering women economically by providing them with collateral-free loans.

Key Points:

• This scheme is part of a broader effort to address gender disparities and support women in pursuing entrepreneurial ventures, livelihood activities, and self-employment opportunities.
•  The initiative not only fosters financial inclusion but also promotes socio-economic development among women in the state.

Key features of the Scheme

1. Collateral-free loans: The scheme offers loans without requiring any collateral, a significant barrier for many women who lack valuable assets to secure loans. This feature allows women to access credit without risking their assets in case of repayment difficulties.
    
2. Loan amounts and repayment terms: Beneficiaries can avail of loans in three tiers:
   • First Loan: Rs. 21,000, repayable over five years with an EMI of Rs. 431.
   • Second Loan: Rs. 51,000, available after successful repayment of the first loan, with an EMI of Rs. 1,047.
   • Third Loan: Rs. 1,01,000, offered after the second loan is repaid, with an EMI of Rs. 2,073.
      
3. Eligibility criteria: Women aged 18 to 55 years with two savings accounts in the family with the Himachal Pradesh State Cooperative Bank are eligible for the first loan. The loan is guaranteed by the spouse of the woman.
    
4. Interest rate: The loans are offered at an attractive interest rate of 8.51%, making them affordable for women to manage their finances efficiently.
    
5. Financial inclusion: The scheme encourages all family members to open savings bank accounts, leading to a 100% waiver of ATM charges for the entire family. This promotes financial awareness and reduces transaction costs.

Impact of the Scheme

1. Economic empowerment: The primary objective is to empower women economically by providing them with financial support to engage in livelihood activities, start microenterprises, or pursue agricultural ventures.
    
2. Socio-economic development: The scheme aims to enhance the socio-economic status of women by enabling them to become financially independent and contribute meaningfully to their families and communities.
    
3. Financial literacy: By promoting financial inclusion and encouraging disciplined repayment behavior, the scheme fosters a culture of financial responsibility among women.
    
4. Social security: Borrowers are encouraged to enroll in social security schemes like PMJJBY (Pradhan Mantri Jeevan Jyoti Bima Yojana) and PMSBY (Pradhan Mantri Suraksha Bima Yojana), providing them with insurance coverage in case of unforeseen events.