Yuva Sahakar Scheme: Empowering Youth-Led Cooperatives Through Innovation and Financial Support

Why in News ?

The Ministry of Cooperation recently informed Parliament about the financial assistance released to cooperative societies and beneficiaries under the Yuva Sahakar Scheme during the period 2022–2025, highlighting the scheme’s role in promoting youth entrepreneurship in the cooperative sector.

Background and Context

• India has one of the world’s largest cooperative movements, with over 8.5 lakh cooperative societies spanning agriculture, dairy, banking, housing, fisheries, and other sectors.
• Traditionally, cooperatives have been dominated by older leadership structures, often limiting youth participation and innovation.
• At the same time, India faces a demographic opportunity:
  • A young population,
  • Rising aspirations for entrepreneurship,
  • Need for job creation, especially in rural and semi-urban areas.
• The creation of the Ministry of Cooperation in 2021 marked a renewed policy push to revitalise the cooperative sector through:
  • Professionalisation,
  • Digitalisation,
  • Inclusion of youth and women.
• The Yuva Sahakar Scheme was introduced to align cooperative development with youth entrepreneurship and innovation.

What is the Yuva Sahakar Scheme ?

• Full name: Yuva Sahakar Cooperative Enterprise Support and Innovation Scheme.
• Nature: A national scheme aimed at encouraging newly formed cooperative societies with innovative business ideas.
• Target group: Young entrepreneurs operating cooperative societies that have been functional for at least three months.
• Core focus: Supporting youth-led cooperative enterprises to become financially viable, innovative, and sustainable.

Objectives and Key Features

1. Encouraging Youth Entrepreneurship in Cooperatives

• The scheme aims to attract young people into the cooperative sector by:
  • Supporting new and innovative business models,
  • Reducing financial barriers to enterprise creation.

2. Long-Term Loan Facility with Interest Subvention

• Loans provided under the scheme:
  • Are long-term, with a tenure of up to five years.
  • Carry an interest subvention of 2% on the applicable rate of interest on term loans.
• This reduces borrowing costs and improves project viability.

3. Dedicated Fund with Liberal Provisions

• The National Cooperative Development Corporation (NCDC) has created a dedicated fund for the scheme with flexible norms to:
  • Encourage wider participation,
  • Support innovative and risk-taking ventures.

4. Regional and Social Inclusiveness

• Additional incentives are provided to:
  • Cooperatives in the North-Eastern region,
  • Those located in aspirational districts.
• Exclusive benefits are extended to:
  • Women entrepreneurs,
  • Scheduled Caste (SC),
  • Scheduled Tribe (ST) candidates.

5. Focus on Innovation and Enterprise Sustainability

• Priority is given to projects that:
  • Introduce new products, services, or processes,
  • Demonstrate long-term financial and operational sustainability.

Implementation Framework

• Implementing Agency:
  • The scheme is implemented nationwide by the National Cooperative Development Corporation (NCDC).
• Operational Mechanism:
  • Eligible cooperative societies submit project proposals to NCDC.
• Proposals are appraised based on:
  • Financial viability,
  • Innovation content,
  • Employment potential,
  • Social and regional impact.
• Approved cooperatives receive:
  • Term loans with interest subvention,
  • Ongoing monitoring and institutional support.

Significance of the Yuva Sahakar Scheme

1. Revitalising the Cooperative Movement

• Infuses new energy, leadership, and innovation into a sector often viewed as traditional or stagnant.

2. Promoting Youth Employment and Entrepreneurship

• Encourages young people to become:
  • Job creators rather than job seekers,
  • Leaders of community-based enterprises.

3. Advancing Inclusive Growth

• Special incentives for:
  • Women,
  • SC/ST groups,
  • North-East and aspirational districts,

ensure equitable access to economic opportunities.

4. Supporting Rural and Semi-Urban Development

• Strengthens grassroots economic activity, especially in:
  • Agriculture,
  • Allied sectors,
  • Rural services and manufacturing.

5. Aligning with National Development Priorities

• Supports broader policy goals such as:
  • “Sahakar se Samriddhi” (Prosperity through Cooperation),
  • Atmanirbhar Bharat,
  • Sustainable and community-led economic growth.