Finance Ministry

Pavala Vaddi Scheme

The Pavala Vaddi scheme is started by Andhra Pradesh government (Finance Ministry) for interest subsidy on the Bank loans taken by the self help groups in Andhra Pradesh to reduce the financial burden for setting up of New Micro and Small enterprises including Food processing Industries in the state. The Scheme is applicable to all loans extended by banks on or after 01.07.2004, under SHG Bank Linkage Programme

Toll Free Number: 1800 425 1515

Benefits of Pavala Vaddi Scheme:

  • The Pavala Vaddi scheme provides benefits in the form of interest subsidy on the Bank loan taken by the self help groups or micro and small enterprises
  • The interest amount paid by the eligible micro and small enterprises to the financial institution/banks on the term loan availed will be reimbursed with a maximum limit of 9% on half-yearly basis to the concerned financial institutions or bank
  • The incentive will be in the form of reimbursement of interest whatever is above 3% interest irrespective of bank interest rates and will not include penal interest, liquidated damages etc., paid to the bank
  • Benefit will be available for a period of 5 years

Required eligibility and conditions for applying Pavala Vaddi Scheme:

  1. New micro and small enterprises set up in Andhra Pradesh state except in the Municipal Corporation limits of Visakhapatnam, Vijayawada and Hyderabad
  2. The benefit shall be extended only to the eligible new units which are promptly and regularly repaying the loan installments of principal and interest

Document required for applying Pavala Vaddi Scheme:

  1. Aadhar card
  2. Residence proof e.g. certificate from residence authority
  3. Identity proof
  4. Micro business registration number or organization registration number

Whom to contact and where to contact:

  1. Applicant can have contact with nationalize bank e.g. Andhra bank
  2. Toll Free Number: 1800 425 1515
  3. Note : Bank will provide detailed information about everything required for application and other help

References & details:

  1. For more details regarding documents and other help please visit official website: http://rd.ap.gov.in
  2. http://andhrabank.in/english/Pavala.aspx
  3. http://www.apmas.org/pdf/Who%20is%20Benefitting%20with%20SHG-BL%20and%20Pavalavaddi%20-%20A%20Reality.pdf
  4. http://www.aponline.gov.in/apportal/homepagelinks/schemes.htm
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