The government of India believes that all citizens should be provided with equal opportunities, and no one should be left behind, due to bodily disabilities. As a result, the government offers various convenient loan schemes to physically handicapped people at low-interest rates.

Loans for physically disabled people provide the necessary financial aid to help them live their lives with dignity, without relying on others financially. Contrary to other regular loans, specialized loans for disabled people are easy to obtain and require only minimal paperwork.

Here, in this guide, we take a look at the different loan schemes for physically disabled people in India.

The National Handicapped Finance and Development Corporation 

Shortly known as the NHFDC, the organization is set up under the Ministry of Social Justice and Empowerment. The government of India launched the NHFDC on 24th January 1997. It's a not-for-profit organization that is wholly owned by the government of India. The GoI appoints the Board of Directors for the NHFDC, and it has an authorized share capital of over 400 crore rupees. The NHFDC is the apex institution that is responsible for channelizing funds for loans to people with disabilities. The funds are disbursed via SCAs (State Channelizing Agencies) that are appointed by respective state governments.  

Loans for Physically Handicapped Persons under the NHFDC 

The NHFDC offers specialized loans to cater to the financial needs of physically disabled people. The interest rates on these loans cannot exceed 8%, and the maximum tenure is 36 months.

The primary loan scheme offered by the NHFDC is the Divyangjan Swavalamban Yojana. 

Salient Features of the Loan: 

Purpose: To provide credit at concessional rates to persons with disabilities (PwD)

  • For starting an activity that leads to income generation 

  • For pursuing higher education (UG, PG, professional courses or other courses approved by the AICTE/UGC/ICAR)

  • For continuing skill development (ITI, Diploma, etc.)

  • For the purchase or retrofitting of any assistive machine, vehicle, equipment 

Eligibility Criteria:

  • Indian citizens with 40% or more disability as defined in the PwD act of 2016 

  • Aged above 18 years (for applicants with mental disabilities the entry age is relaxed to 14 years)

Rate of Interest: Ranges from 2% to 4.5% depending on the amount borrowed. Rebates in interest are available for women borrowers. 

Maximum Loan Amount: Up to Rs. 50 lakhs 

Type of loan: Term loan/working capital loan 

Repayment of loan: Maximum up to 10 years

Prepayment charges: NIL 

Besides this loan scheme, the NHFDC also offers other loans for disabled people including the:

  • Vishesh Microfinance Yojana – To set up a small business, for purchasing vehicles for commercial activities, to provide funds for agricultural activities and more 

  • Mahila Samriddhi Yojana – Economically weak disabled women can use this loan scheme to borrow funds for starting an income-generating business.  

  • Financial assistance for skill development and entrepreneurial ventures 

  • Schemes for disabled professionals to set up their practice

  • Micro-financing schemes for starting or setting up income generation activities 

Eligibility Criteria for Disabled Loans from the NHFDC 

The actual list of eligibility criteria varies based on the type of loan scheme chosen. However, the general conditions are:

  • The applicant must be an Indian citizen. 

  • Must be aged between 18 and 55 years. However, for people with mental disabilities, loans are offered from the age of 14 years. 

  • The borrower must have a minimum disability of 40% or more, as defined in the PwD (People with Disabilities) Act of 2016. 

  • The annual income of the applicant must be at least Rs. Eighty thousand or more, in rural regions and Rs. 1 lakh or more in urban areas.

  • The borrower should not have availed financing under any other scheme offered by central or state governments. 

  • Applicants who are members of self-help groups are given preference. 

  • Similarly, women borrowers are also given preference. 

For the final list of eligibility conditions, get in touch with the NHFDC department. 

Where to avail loans from NHFDC?

You can apply for any of the schemes mentioned above at:

  • SCAs (State Channelizing Agencies) 

These are bodies that are set up by respective state governments and union territories. Borrowers can approach any SCA to avail any of the schemes offered by the NHFDC. Loans up to Rs. 10 lakhs are sanctioned by the SCA, while loans above Rs. 10 lakh are diverted to the NHFDC directly. 

  • Nationalised and Regional Rural Banks

Most nationalized banks and regional rural banks offer loans for physically disabled persons. Some of the banks that extend loans under the NHFDC include IDBI Bank, Andhra Bank, Punjab National Bank and State Bank of India.

  • NGOs

Several NGOs help disabled people submit their loan applications to the respective SCA. You can approach a trusted NGO to help you with the relevant documents and other application details. 

Other Loans for Physically Handicapped People 

Most national banks offer loan schemes to help physically disabled people. One of the popular loan schemes for physically disabled people is the BOI Star Mitra Loan from Bank of India. 

BOI Star Mitra Loan 

The Star Mitra Loan from Bank of India helps physically disabled people to live a financially independent life. 

Highlights of the loan include:

  • Purpose – To help physically disabled people purchase select appliances and aids to promote their social and physical rehabilitation.

  • Eligibility – Self-employed and salaried PwD. Parents of physically disabled children can also borrow under this scheme. 

  • Loan type – Secured loan in the form of term or demand loan. 

  • Borrowers must provide quotation/invoice for the equipment to be purchased using the loan amount. 

  • Rate of interest – 1% + BSS (0.3%) 

  • Repayment tenure – 12 months to 60 months 

  • Processing charges – Rs. 1000 to Rs. 10,000 (nil for senior citizens) 


Secure the Right Loan and Live with Dignity 

Physically disabled people can check out the different loan schemes available and choose the right one that best suits their needs. With low-interest rates, easy documentation, fast processing – loans for physically disabled people are indeed a boon. Use the loan amount to set up an income-generating business/activity and live your life with dignity.