HP govt expands small shopkeepers' welfare scheme to urban areas: CM

Shimla, Dec 21 (PTI) Himachal Pradesh Chief Minister Sukhvinder Singh Sukhu on Sunday announced the expansion of Mukhya Mantri Laghu Dukandar Kalyan Yojana, a welfare scheme that provides economic relief and support to small shopkeepers, to urban areas as well.

The scheme has been implemented in rural areas since 2023.

The scheme, notified as "Mukhya Mantri Laghu Dukandar Kalyan Yojana-Shahri", would be implemented in all urban local bodies as announced in the state Budget 2025-26. A notification in this regard has already been issued, he said.

Sukhu said a large number of traders in urban areas earn their livelihood through small businesses but often lack financial capacity and access to institutional support.

"Due to financial stress, many of them were unable to repay bank loans and their accounts turned into Non-Performing Assets (NPA). Keeping this in view, the state government has decided to extend this welfare scheme to urban areas," he said.

"Under the scheme, distressed small shopkeepers who have an annual turnover of less than Rs 10 lakh and who have availed business loans that have been declared NPAs, would be provided One-Time Settlement (OTS) assistance of up to Rs 1 lakh through banks. The OTS amount would be borne entirely by the state government," the chief minister said.

Beneficiaries whose total outstanding amount -- including principal and interest -- was up to Rs 1 lakh, would get full settlement under the scheme. In cases where outstanding dues exceed Rs 1 lakh, the beneficiaries will have to deposit the remaining amount themselves.

"However, the maximum loan amount availed by any beneficiary should not exceed Rs 10 lakh," Sukhu said.

The chief minister said the scheme has been designed with a strong focus on transparency and ease of access.

"A clearly defined institutional mechanism involving urban local bodies, banks, a nodal bank and the urban development department has been put in place to ensure timely settlement of claims and smooth closure of NPA accounts," he said.

"By removing the burden of interest during the intervening period and by not allowing any processing or administrative charges, the state government has ensured that maximum benefit reaches genuine small shopkeepers," he said.

He said the scheme would apply to collateral-free business loans taken between April 1, 2020 and March 31, 2025.

"Cases involving wilful default, fraud or malfeasance would not be covered under the scheme. Banks would identify such cases to ensure that only deserving beneficiaries get the benefit. Loans covered under the Credit Guarantee Fund Trust for Micro and Small Enterprises or other guarantee trusts would be eligible only if the remaining uncovered amount is less than Rs 1 lakh," he said.

The applicants must be permanent residents of Himachal Pradesh, above 18 years of age and no family member of the applicant should be in regular government service, the chief minister said.

"The applications would be submitted to the concerned urban local bodies, which would verify and forward them to banks for further processing. Banks would submit monthly OTS claims through a nodal bank to the urban development department. No processing or administrative fee would be charged from the beneficiaries," Sukhu said. PTI COR RUK RUK