Credit Based Schemes for SC - Term Loan (TL)

Credit Based Schemes for SC - Term Loan (TL) helps entrepreneurs from the Scheduled Caste community get low cost term loans to start or expand their own businesses. National Scheduled Castes Finance and Development Corporation (NSFDC) offers term loans covering up to 90% of the project cost through State Channelizing Agencies and partner banks, with the beneficiary paying 8% interest per annum. As per the latest NSFDC update for 2026, the scheme continues to support SC entrepreneurs with an annual family income of up to ₹5.00 lakh.

Applications are now accepted online through the PM-SURAJ portal or offline through the nearest State Channelizing Agency. For the financial year 2026-27 the eligibility, loan limit and interest details have been revised, and the details are given below.

Credit Based Schemes for SC - Term Loan (TL) - Introduction

Credit Based Schemes for SC - Term Loan (TL) is a supportive scheme run by the Ministry of Social Justice and Empowerment through NSFDC. It helps Scheduled Caste entrepreneurs achieve financial independence by giving affordable credit for many kinds of business activities.

NSFDC provides term loans for viable projects. The project cost can range from more than ₹1.40 lakh up to ₹50.00 lakh, and the loan covers up to 90% of that project cost. The remaining amount is often supported through subsidies or contributions from State Channelizing Agencies (SCAs).

Key Information

Benefits

Financial support under this scheme depends on the size of the project. As per the official NSFDC scheme page updated for 2026, term loans are provided for units costing more than ₹1.40 lakh and up to ₹50.00 lakh. The loan amount can go up to 90% of the project cost, which works out to above ₹1.25 lakh and up to ₹45 lakh per unit.

Interest Rate: NSFDC charges 4% interest from the State Channelizing Agency or Channelizing Agency, which in turn charges 8% per annum from the beneficiary. This keeps the final cost of credit low for SC entrepreneurs.

Repayment Terms: A borrower repays the loan in quarterly installments within a maximum period of 7 years from the date of payment.

Moratorium Period: The repayment starts after a grace period of 6 months. For plantation and construction activities, this moratorium period is extended to 12 months, giving the business time to stabilise.

Eligibility

The scheme is made for Scheduled Caste entrepreneurs. NSFDC states that the eligible people must belong to the Scheduled Caste community, and their annual family income should not exceed ₹5.00 lakh, which is the revised limit for 2026. Individuals, partnership firms and cooperative societies can take part.

For example, if Ramesh, who belongs to the SC community, wishes to set up a small poultry farm, he can apply for this loan provided his total annual family income does not exceed ₹5.00 lakh and his project fits within the prescribed cost range.

Find out more about who can apply on the official NSFDC eligibility page.

Application Process

For 2026, NSFDC has made it easier to apply. An applicant can send the proposal online through the PM-SURAJ portal or offline through the nearest State Channelizing Agency (SCA). The main steps are given below.

STEP 1 - Go to the official PM-SURAJ portal at pmsuraj.dosje.gov.in and complete the user registration using a valid mobile number for OTP based authentication.

STEP 2 - Fill in the standardised online application form and upload scanned copies of all the required documents, including caste certificate, income proof and KYC documents.

STEP 3 - Submit the proposal online. The system generates a unique application ID through which the applicant can track the status of the proposal.

STEP 4 - Alternatively, an applicant can submit the application offline at the nearest district branch office or head office of the State Channelizing Agency, attaching the caste certificate, income certificate, KYC documents and other required documents as per the SCA checklist.

STEP 5 - Once approved, the applicant receives a Letter of Intent outlining the terms and conditions. After accepting these terms, the funds are paid to the agency for onward transfer to the bank account.

Apply online through the PM-SURAJ portal, or see the full NSFDC application process.

Documents

Keep the following required documents ready when applying. The list may change slightly based on the State Channelizing Agency checklist.

• Aadhaar Card and KYC documents for identity proof.
• Income Certificate to show that the annual family income is within ₹5.00 lakh.
• Caste Certificate to confirm the Scheduled Caste category.
• Bank Account Statement for the loan payment.
• Detailed Project Report (DPR) explaining the business plan and viability.

References

Official Scheme Guidelines PDF

NSFDC Term Loan Scheme Details

FAQ's

What is a moratorium period?

A moratorium period is a waiting phase during the loan tenure when no repayments are required. It helps the business stabilise before the installments begin. Under this scheme it is 6 months, and 12 months for plantation and construction activities.

Does this scheme provide loans to all Scheduled Caste individuals?

No, the scheme is made for Scheduled Caste entrepreneurs with an annual family income of up to ₹5.00 lakh, and the project should fall within the prescribed cost range.

How can I apply for support?

An applicant can apply online through the PM-SURAJ portal at pmsuraj.dosje.gov.in or offline through the nearest State Channelizing Agency or a partner bank.

What kind of business projects are covered?

The loan can be used for many activities including agriculture, horticulture, dairy, poultry, small-scale manufacturing, retail shops, transport services and professional services like clinics or internet cafes.