Srinagar, Oct 16: Banks operating in Jammu and Kashmir have failed to meet the targets set under the Union Territory’s employment-generation schemes in 2025-26.
This emerged at the Union Territory Level Bankers’ Committee (UTLBC) meeting held in August 2026. The review found that programmes meant for young entrepreneurs, rural households, weavers and artisans recorded performance described as poor or unsatisfactory. The numbers point to a wide gap between applicants sponsored by government agencies and those who actually received loans.
The sharpest pendency was under the Prime Minister’s Vishwakarma scheme. Against 39,241 sponsored cases, banks sanctioned Rs 135.50 crore to 14,645 beneficiaries up to March 31, 2026, which is about 37 per cent of the cases. Another 11,912 cases were rejected, and 12,684 were still pending with banks for sanction. More than 24,500 applicants were therefore either turned down or left waiting. The house noted that performance was not up to the mark. Banks attributed the pendency to the scheme’s monthly EMI of Rs 6,000, which they said is high because the loan tenure is only 18 months.
The Prime Minister’s Employment Generation Programme (PMEGP) also fared badly. Against 11,317 sponsored cases, banks disbursed Rs 303.23 crore to 4,849 beneficiaries. The annual target was Rs 926.42 crore for 6,225 beneficiaries, so banks reached roughly a third of the financial target and about 78 per cent of the beneficiary target. Progress against both targets and sponsorship was termed unsatisfactory. The meeting attributed the low performance to the scheme’s portal, which remained non-functional for a large part of the year.
Under the National Rural Livelihood Mission (NRLM), banks sponsored 19,059 cases and disbursed Rs 637.89 crore to 17,986 beneficiaries. The target was Rs 616.45 crore for 28,700 beneficiaries. The financial target was exceeded, at about 103 per cent, but beneficiary coverage reached only around 63 per cent. The meeting called coverage poor against both target and sponsorship, suggesting that larger loan sizes rather than wider reach drove the headline figure.
The record was weakest for the handicraft and handloom sector, the backbone of Kashmir’s traditional economy. Under the Pradhan Mantri Weaver’s Mudra Yojana, only 227 cases were sponsored. Banks disbursed Rs 2.11 crore to 142 beneficiaries, against a target of Rs 10.64 crore for 1,064 beneficiaries, which is under 20 per cent in value terms. The Credit Card Scheme for Artisans and Weavers did little better. Of 2,285 sponsored cases, banks disbursed Rs 27.75 crore to 1,853 beneficiaries, against a target of Rs 207 crore for 11,500 beneficiaries, or about 13 per cent of the financial target. For both schemes, sponsorship as well as disbursement remained poor.
The J&K Rural Employment Generation Programme (JKREGP) showed a different problem. Sponsorship comfortably exceeded the target, with 2,045 cases against 1,266 beneficiaries. Yet banks disbursed Rs 67.75 crore to only 1,004 beneficiaries, against a target of Rs 75 crore for 1,266 beneficiaries. Barely half of sponsored cases became loans, and the meeting noted that disbursement and coverage remained poor despite satisfactory sponsorship.
Mission YUVA emerged as the comparatively brighter story. As on March 31, 2026, J&K Bank and J&K Grameen Bank together disbursed Rs 930.56 crore to 18,753 beneficiaries under its three variants during 2025-26, against 47,263 sponsored cases. Even so, fewer than four in ten sponsored applicants were funded. The Managing Director and CEO of J&K Bank expressed optimism about reaching youth, informing the house that the bank has covered more than 30,000 young people under the nano variant, a figure expected to cross 50,000 by the end of the current financial year.
The Chief Secretary, who chaired the meeting, urged other banks to take a cue from J&K Bank’s performance and contribute to the Union Territory’s economic development. He directed the Mission YUVA department to onboard State Bank of India and Punjab National Bank for lending under the scheme.
Stressing the purpose of these programmes, the Chief Secretary said government-sponsored schemes were devised to generate employment opportunities for youth, and that banks’ contribution in extending credit could change the region’s economic landscape. He said banks and sponsoring agencies must work in tandem and handhold aspiring entrepreneurs so that their aspirations become employment- and revenue-generating units.
He directed banks to provide “hassle-free” financing under youth-centric and enterprise-focused programmes, including PMEGP, JKREGP, NRLM, PMWMY, the credit scheme for artisans and weavers, PM Vishwakarma and Mission YUVA. These form part of the administration’s broader strategy to expand self-employment opportunities. The formal decision of the meeting asked all banks to come forward and provide hassle-free credit to unemployed youth under the various schemes, with all banks named as the action party.
The pattern across the review is hard to miss. Agencies are sponsoring applicants, but banks are converting too few of them into borrowers, and technical failures such as the dysfunctional PMEGP portal have added to the problem. With the financial year closed, thousands of young people and micro-entrepreneurs are still waiting for credit. Quicker processing, a reliable portal, loan terms that borrowers can afford and wider participation by large lenders will decide whether the 2026-27 targets are met.
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