General Awareness section in any entrance examination is very important as it can make or break the deal. It holds equal weightage in the written exam as well as the interview/GDPI. Therefore, here we are sharing a GK post on the new schemes introduced by the government. These were announced on the last day of 2016 i.e. December 31, 2016. Thoroughly go through them and expect a few questions in your forthcoming entrance examinations and interviews. See if you would also like to read How to prepare for general awareness for banking exams?
Narendra Modi’s address to the Nation on 31st December was aimed at launching new government schemes for middle-income families, the poor, pregnant women and senior citizens. PM’s new-year address talked about the results of the demonetisation drive and the kind of efforts that are being made for remonetisation.
A rate cut is expected as Rs. 7 Lakh Crores has been deposited in banks since November 8. With such funds, talk of recapitalization of banks or attempts at bringing in new Basel Norms for the Indian banking system can be kept out of the discussion. Cash Reserve Ratio was increased to 100% in December. Even now with the liquidity in the banking system, a rate cut is expected. Rather than it coming from the Reserve Bank of India, Prime Minister Modi has introduced certain schemes and Government will bear the cost of lower interest rates for middle income families, senior citizens, small traders, and the loans being made available under the MUDRA Yojana. Detailed insights into these schemes will help you in answering questions based on the Government schemes for the poor and the small traders where the Government is bearing the cost.
- Cheaper housing loans
Plans for loans for new rural housing and those for middle income groups were announced by the Prime Minister on 31st December, 2016. Interest rate subvention of 4% and 3% under the Pradhan Mantri Awas Yojana will be provided on loans up to Rs. 9 Lakh and 12 Lakh respectively. In addition to that, there are plans to increase the number of families that gain from the scheme by 1/3rd of the number for 2016. Even in case of rural housing, on loans upto Rs. 2 Lakh, the interest rates can be lower by up to 3 percent.
- Credit Guarantee for Small traders
Under this scheme, it was loans upto Rs. 1 Crore that were covered, but now the limit has been increased to Rs. 2 Crores. Also, the scheme now is not just for loans from banks but also for Non-Banking Finance Companies. Cost of underwriting these loans will be covered by the Government of India. Credit limit has been increased from 20% of turnover to 25% of turnover for the trader. Even in case of working capital loans, the limit for the loan has been increased from 20% of turnover to 30% of turnover.
- Mudra Yojana for farmers and others
About 3.5 Crore people have been benefitted from this scheme launched by the PM last year. MUDRA (Micro Units Development and Refinance Agency) Bank is expected to double the number this year. It is the tribals, the backward classes and women that form the focus groups this year.
- Sops for Senior Citizens
For senior citizens, on deposits up to Rs. 7.5 Lakhs, interest rate of 8% will be provided with a provision for monthly interest.
- Pregnant women
Rs. 6000 will be transferred to the bank accounts of pregnant women for institutional delivery and vaccination. A pilot project was launched in 53 districts. This would now be extended to 650 districts.
The above mentioned government schemes add to the existing schemes as the banking system and the Government can provide loans with lower interest rates when inflation considerations do not see it going up in the near future and the rates can go low as there is a lot of liquidity in the banking system. Read, Pros and Cons after PM’s historic move. Demonetisation has changed the Indian fiscal & monetary policy landscape in the last two months. Also read, what do you know about Fiscal Deficit in India?