Local leaders give thumbs up for REDCL loans

Local leaders (Gups) are excited to use Rural Enterprise Development Corporation Limited (REDCL) loans, which have flexible installment schedules to bring further development in their gewogs.

Villagers can avail loans at 4 percent interest with no mortgage repayable in 10 years but they need a guarantor. A person can pay the loan installments monthly, quarterly, half-yearly or yearly.

Orong Gup Jigme said he will engage youths and villagers with REDCL funds. He has a plan to come up with homemade ritual related products like Tshog (Khabzay), Druna and grind wheat.  “I think this project will address waste management and at the same time address youth employment issues,” he said adding that he has started discussing about the project with some school drop-outs in gewog and hopes to establish the project soon.

Gup Tshering Dorji of Dopshari, Paro, said the fund is going to benefit rural people in many ways. He said that he would encourage people in farming, diary product and poultry to reduce imports. “With this fund support, our gewog has already started production of sausages and we will soon start with a production of glacier oils,” he said.

He said that 5 star hotels in the country are importing glacier oil paying Nu 2,800 a litre. “Nothing much needs to be done as plants are growing in Bhutan,” he said.

Gup Tawla of Tsangkha said that his gewog has recently availed a fund of Nu 300,000 to set up a fishery adding that the REDCL fund will benefit youth, mostly class X and XII pass-out who couldn’t continue their studies. “These groups of youths are with a diary production with their private budget and now REDCL in place, I think it will help a lot to promote their business and to even bring in market and hoping for huge impact with its help,” he said.

Rangthangling gup Bal Bhadur Tamang said that there are a few who have submitted their proposal and are waiting approval. “75 percent of people in my gewog are interested in availing the fund but due to delay in approval they somehow lose interest,” he said.  “If their proposal gets rejected at the very end after waiting for so long I think they will be discouraged and may not approach further.”

Pema Wangdi, CEO of REDCL during the conference shared the possibility of increasing the fund size from Nu 100,000 to Nu 500,000 to encourage small business in manufacturing and production and entrepreneurship among the young graduates and women.

He also said that to place the services at the doorstep of rural people, each dzongkhag would have a focal person representing REDCL from January 2017. “Here, local leaders can play a very important role in informing people about the micro finance and to help deliver the fund services and to identify those who are genuinely interested,” he said.

However, he also said that even though their mandate is to provide fund to non-formal activities in rural Bhutan of 100 percent 32 percent have misused funds to buy vehicle and some have not even started the business. “But some already paid their loans and some are still paying and for those who fail to pay, we are trying to get back the money through the guarantor,” he said.

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