Credit Linked Back-Ended Subsidy (CLBES) is a very convenient way of providing subsidies by governments to the beneficiaries, under various schemes.
The beneficiary has to avail loan from the Nationalized Banks /Financial Institution (FI) such as NABARD, IDBI, SIDBI, ICICI, State Financial Corporations, State Industrial Development Corporations, NBFCs, NEDFI, NationalSCST/minorities/ Backward- Classes Financial and Development Corporation, other designated loaning institutions of the State / UTs, Commercial/ Cooperative Banks, etc. Concerned banks/ State FIs may adhere to their own appraisal norms while sanctioning projects under the govt schemes. The appraisal note submitted to concerned government authority for sanction/ Claim of subsidy should invariably be the same which formed the basis for sanction of term loan.
The payment of back-ended subsidy will be made after the project has been successfully completed according to the terms and conditions of the loan/or as per the approved feasibility cum project report, as the case may be.Upon completion of the project, the concerned Bank/FI/would inform the concerned govt departments.
Under the system of CLBES, on behalf of a debtor, government pays to his/her financing agency the last installments of a loan, after completion of the sanctioned project.
– By A.K. Chakraborty, Secreatary, ISVEC