Poor CIBIL score to hit Rajiv Yuva Vikasam loan dreams of Telangana’s youth

With the CIBIL score to play a crucial role in selection of beneficiaries for the Rajiv Yuva Vikasam scheme, under which unemployed youngsters can avail loans with the State government's assistance, applicants in Telangana are now a worried lot

Sangareddy: With the CIBIL score to play a crucial role in selection of beneficiaries for the Rajiv Yuva Vikasam scheme, under which unemployed youngsters can avail loans with the State government’s assistance, applicants in Telangana are now a worried lot.

The scheme, one of the election promises of the Congress envisages help for unemployed youth with subsidised loans up to Rs.4 lakh. Beneficiaries, who apply for a loan of Rs.50,000 will be given Rs.40,000 as subsidy and remaining Rs.10,000 as loan by the banker. Those who apply for loans of Rs.1 lakh to Rs.2 lakh will be given 80 per cent subsidy and the remaining will be a loan from the banker. Those who apply for loans of Rs 2 lakh to Rs 4 lakh, will be given 70 per cent subsidy and the remaining amount as a loan.

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Since bankers have to check the repayment capability of all applicants before selecting beneficiaries, the unemployed youth are worried that they may not get selected due poor CIBIL scores. The CIBIL score is a three-digit numeric summary of one’s credit history. The score is derived using the credit history found in the CIBIL Report (also known as CIR i.e Credit Information Report). A CIR is an individual’s credit payment history across loan types and credit institutions over a period of time.

In this case, many applicants, mostly unemployed and from backward classes, are those who could not repay their previous loans in time due to financial issues. And this has affected their CIBIL scores. The applicants are now urging the government to ignore the CIBIL score while selecting beneficiaries for the scheme.

Meanwhile, District Rural Development Organisation officials have completed the screening of the applications which they would forward to selected bankers in their respective districts for their screening. While over 49,000 have applied for the benefit in Sangareddy, more than 32,000 applied in Medak district. Officials said they would discuss the selection criteria during the district consultative committee before finalising the list.