Countering Recession

J&K Bank has came out with four products including the revised DastKaar Finance, a product launched a few years back. Avowed objective for the intervention is to “alleviate the problem of liquidity at export/trader/manufacturer levels and to ensure the continuation of craftsmen without  exploitation”. Assumed to trigger a credit off take of Rs. 62 cr, it will jack up bank’s exposure to over Rs. 100 cr. Here are the main features of the products:

JK Bank Craftsman Livelihood Finance under trilateral agreement between the bank, exporters and craftsmen
Eligible Crafts
Carpet weaving
(Rs 75000 to Rs 3 lacs)
Kani shawls ( Rs 60,000)
Shawl Embroidery (Rs 60,000)
Chain stitch (Rs 70,000)
Crewel (Rs 1 lac)
Wood carving (Rs 1 lac)
Papier machie (Rs 1 lac)
Rate of interest;
10% fixed
Security: Hypothecation of Raw Material & receivables and CGTMSE cover
Renewal: on yearly basis
JK Bank Handicrafts sustenance finance under tripartite agreement
one time Working capital term loan facility for exporters, traders, retailers and manufacturers
Quantum of finance varies for businessmen who already have a business relationship with the bank
Quantum of finance linked to quantity of finished goods prepared by craftsmen in 18 months
Loan to be repaid in 8 equal quarterly installments after a moratorium of 18 months
Rate of interest: 10 to 10.5%
J&K bank Handicrafts Sustenance Finance outside Tripartite agreement
The scheme is similar to the previous one except that it is available to the businessmen involved in any craft who do not want to enter into a tripartite agreement with the craftsmen
J&K Bank Dastkar Finance
Term loan and working capital facility for all types of craftsmen
Limits, moratorium and repayment schedule fashioned on the basis of production cycle specific to a particular craft. No collateral security.
10% rate of interest.

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