Objectives of Financing Joint Liability Groups Of Tenant Farmers (JLG) are to augment flow of credit to tenant farmers cultivating land either as oral lessees or sharecroppers and small farmers who do not have proper title of their land holding through formation and financing of JLGs.
Joint Liability Groups (JLG)
JLG is an informal group compromising preferably 4 to 10 individuals (may be considered upto 20) engaged in similar economic activity like crop production, coming together for purpose of availing bank loan either singly or through group mechanism against mutual guarantee. The JLG members would offer a joint undertaking to the bank that enables them to avail loans. The management of the JLG is to be kept simple with little or no financial administration within the group.
Any person who holds land under another person's name and pays rent to such other person on account of the use of land is called a tenant i.e. Tenant is a person who has taken the lease and is liable to pay rent for the piece of land.
Purpose of JLG Agriculture Loan for Tenant Farmers
Crop production, consumption, marketing and other productive needs. Facility as KCC, ACC or ATL depending on purpose. Max loan amount Rs. 50,000/- per individual. Margin as per usual norms, mutual guarantee, no collateral.
Type of JLG Agriculture Loan for Tenant Farmers
Depending upon the requirement such as cash credit, short-term loan or term loan.
Loan Amount for JLG Agriculture Loan for Tenant Farmers
Maximum loan amount is Rs 50000/ per individual, under both models.
Margin and Security Norms of JLG Agriculture Loan for Tenant Farmers
No collateral required against the loans to JLGs. It may however, be ensured that the mutual guarantees offered by the JLG members are kept on record. Margin as per the usual norms may be applied.