Microcredit Finance Scheme — ₹5L Loans at 6% for Gujarat SC SHGs

The Microcredit Finance Scheme for Self-Help Groups is a debt-based funding route operated by the Development Corporation for Rabari/Bharwad and Allied Castes (DAADC), Government of Gujarat, under the state's Social Justice and Empowerment Department. It exists to put working capital within reach of Scheduled Caste entrepreneurs in Gujarat who would find it hard to raise an unsecured loan from a bank on their own.

The scheme's focus is self-employment. It backs small-scale business ventures — both new businesses and existing ones that need to expand — so that unemployed people from SC communities can shift from looking for work to running an enterprise of their own. Because the support arrives as a repayable microloan rather than a one-off grant, the same pool of money can rotate and reach further batches of beneficiaries.

Two design choices make this loan easier to access than a typical commercial one. First, no guarantor is asked for, which clears a hurdle that normally stops first-time borrowers from weaker economic backgrounds. Second, the cost is shared heavily in the applicant's favour: the state government's share of a sanctioned loan is 95%, while the beneficiary contributes the remaining 5%.

There is no closing date to plan around. Applications are accepted throughout the year on a rolling basis, so an applicant can move ahead whenever the business proposal and paperwork are ready.

• Microloan of up to ₹5,00,000 per beneficiary
• Concessional interest of 6% a year
• Repayment spread over 36 months (roughly ₹1,445 a month)
• No guarantor or surety needed
• State government bears 95% of the loan; beneficiary pays 5%
• Open to SC individuals and Antyodaya self-help groups in Gujarat

This scheme is meant for Scheduled Caste households in Gujarat that fall in the Antyodaya (AAY) category. An applicant has to satisfy every one of the following conditions:

• Community: the applicant must be of Scheduled Caste (SC) origin.
• Household category: the family must be an Antyodaya (AAY) family.
• Income: the family's yearly income must not go above ₹3,00,000.
• Domicile: Gujarat residency is mandatory.
• Applicant type: apply as a self-help group of unemployed persons, or as an individual with a genuine business proposal.

Members of a registered self-help group qualify, and so do individuals who are not attached to any group — as long as the business intent behind the application is valid and clearly stated.

Microcredit Finance Scheme — ₹5L Loans at 6% for Gujarat SC SHGs is open to startups at any stage. It is open to startups registered anywhere in India.

Microcredit Finance Scheme — ₹5L Loans at 6% for Gujarat SC SHGs accepts applications on a rolling basis — there is no fixed cut-off date, so eligible startups can apply at any time. Because rolling programmes can pause without notice, confirm the window is still open on the official site before you start.

• Loan amount: a microloan of up to ₹5,00,000 per beneficiary, sanctioned to start or expand a small-scale business.
• Interest: charged at a concessional 6% per annum, which keeps repayment affordable.
• Repayment window: 36 months (3 years), giving the venture time to stabilise. Indicative monthly instalments work out to roughly ₹1,445.
• Cost sharing: the state government's share is 95% of the loan and the beneficiary's share is 5%. On a ₹50,000 loan, that means ₹47,500 from the state and ₹2,500 from the applicant.
• No guarantor: no third-party surety is required to obtain the loan.

The capital is meant to be deployed for self-employment activity — setting up a small business or scaling one that is already running. It is repayable debt, not a grant and not equity.

Microcredit Finance Scheme — ₹5L Loans at 6% for Gujarat SC SHGs is offered by Development Corporation for Rabari/Bharwad and Allied Castes, Government of Gujarat (DAADC), a government body. As a government-backed debt / loan, it is publicly funded and open to eligible startups across India.

Every application filed online is put through a verification exercise by the Dr. Ambedkar Antyodaya Development Corporation (DAADC). Officials check that the applicant genuinely satisfies the scheme's eligibility conditions and that every document asked for has been attached.

The details submitted — caste, income and residence proofs in particular — are examined for authenticity. Approval and the eventual release of the microloan follow only after this scrutiny is complete and the application is found to be fully in line with the scheme's guidelines, so that the funds reach deserving beneficiaries.

Before you apply to Microcredit Finance Scheme — ₹5L Loans at 6% for Gujarat SC SHGs, keep the following documents ready:

• A pitch deck or short business plan describing the problem, product and traction
• Company registration documents and PAN
• Founder identification (PAN / Aadhaar) and brief profiles
• Recent financial statements or projections
• Product details — a demo, prototype or working link if available

Exact requirements are confirmed on the official application portal — treat this as a preparation checklist.

Microcredit Finance Scheme — ₹5L Loans at 6% for Gujarat SC SHGs is best suited for startups in India seeking non-dilutive funding of ₹5L. If that describes your startup, review the eligibility criteria above before applying.