It is probably impossible for unemployed youth in the country to secure a loan from a private financial institution. Worth mentioning that there are a lot of factors that come into play when banks or any other NBFC has to sanction a loan. From documents guaranteeing security to credit score, banks investigative a lot of aspects before handing out a loan. However, the government has come up with a lot of schemes to support individuals who want to kickstart their career or use it for any other purpose.
All the schemes have been rolled out by the government to support unemployed youth in the country and reduce poverty. Having said that, here are some government-backed loan schemes for unemployed youth in India:
Prime Minister Rozgar Yojana: This is one of the many schemes that has been set up by the government for helping unemployed youth secure loans. Under the scheme, the government of India offers loans to unemployed to kickstart their own ventures and anyone who has received education till standard 8 is applicable to apply for loans under the scheme. It may be noted that the loan is of composite nature and individuals can avail a loan of up to Rs 5 lakh for setting up their venture. Also, only those between the age gap of 18-35, who are unemployed, can apply for the loan. However, in the case, the income of the beneficiary along with the income of his/her parents should not exceed Rs one lakh per annum.
Loan subsidy scheme: While it is not available across all states, the Tamil Nadu government has a nifty scheme for unemployed, under which the 25 per cent of the loan amount will be subsidized by the state government. Under the NEEDS scheme or the New Entrepreneur and Enterprise Development Scheme, the state government provides 25 per cent subsidy for any loan taken by unemployed youths who are graduates.
Cash loans: Similar to the NEEDs scheme, this is also a state-funded initiative and has been kickstarted by the government of West Bengal. Under the scheme, an unemployed person can apply for a loan of Rs 50,000 under the scheme. Like all the above measures, this has been started to help unemployed individuals kick off their business ventures. Any individuals belonging to the 18-45 age group can apply and avail the loan.
Agriculture loan: This is a very useful scheme for those unemployed individuals engaged in the agricultural sector. It is worth mentioning that the government has collaborated with many banks and financial institutions to provide agricultural loans to unemployed youths in the country. An unemployed agricultural sector graduate, aged 22 or above, can apply for the loan under the scheme.
Secured loans for unemployed: This is another way unemployed people in the country can get secured loans. However, in this process, the individual will have to pledge some asset to the lender for the loan to be sanctioned. Here, the loan amount will depend directly on the value of the asset.
Courtesy : ET