Formalization of Micro Food Processing Enterprises

• Union Cabinet gave its approval to a new Centrally Sponsored Scheme named Scheme for Formalization of Micro Food Processing Enterprises for the Unorganized Sector on All India basis with an outlay of Rs. 10 thousand crores.

About:

• The expenditure will be shared by the Centre and the States in the ratio of 60:40.

• The objectives of the scheme are to increase access to finance by micro food processing units and enhanced compliance with food quality and safety standards.

• Scheme will be implemented over a five-year period from 2020-21 to 2024-25 and two lakh micro-enterprises are to be assisted with credit linked subsidy.

• Microenterprises will get credit-linked subsidy at 35 percent of the eligible project cost with ceiling of Rs. 10 lakh.

• Beneficiary contribution will be a minimum of 10 percent and balance from the loan. Seed capital will be given to SHGs (Rs. four lakh per SHG) for a loan to members for working capital and small tools.

• There will be on-site skill training and Handholding for DPR and technical upgradation.

• The scheme would be monitored at Centre by an Inter-Ministerial Empowered Committee under the Chairmanship of Minister, Food Processing Industries.