What changed
RBI issued a new master circular (July 20, 2022) that consolidates and updates all prior instructions on DAY-NRLM, replacing the earlier circular from April 1, 2021. The circular reaffirms existing provisions like Revolving Fund support (₹10,000-₹15,000 per SHG), no capital subsidy, and Community Investment Support Fund (CIF) routing through federations.
What it means for you
Banks must ensure their SHG lending and account operations comply with the consolidated guidelines, particularly for KYC verification and Business Correspondent roles. The circular reinforces the demand-driven approach of DAY-NRLM, requiring banks to support women SHGs and their federations with savings accounts and credit facilities, while adhering to interest subvention schemes.
What you must do
- Update internal policies to reference the new master circular (RBI/2022-23/92) for DAY-NRLM operations.
- Train branch staff on SHG account opening norms, including KYC as per Master Direction on KYC (Feb 25, 2016).
- Ensure Revolving Fund eligibility criteria (3-6 months existence, Panchasutras compliance) are correctly applied.
- Verify that CIF is routed through village/cluster level federations and maintained in perpetuity.
- Align interest subvention processing with Annex II of the circular.
Who it affects
Public Sector Banks, Private Sector Banks (including Small Finance Banks), Bank branches in rural areas, Business Correspondents handling SHG accounts
What is the Revolving Fund amount per SHG under DAY-NRLM?
The Revolving Fund support ranges from ₹10,000 to ₹15,000 per SHG, provided to groups that have existed for at least 3-6 months and follow Panchasutras norms, and have not received RF earlier.
Can SHGs with disabled members open savings accounts?
Yes, banks must open savings accounts for all SHGs, including those with members having disabilities, as per the circular.
Is capital subsidy available under DAY-NRLM?
No, the circular explicitly states that no capital subsidy will be sanctioned to any SHG under DAY-NRLM.