Government Announces Rs 10,000 Special Festival Loan For Its Employees

In order to stimulate consumer demand in the economy the government on Monday announced Special Festival Advance scheme wherein all the central government employees will be eligible for an interest free loan of Rs 10,000 which they will have to utilize on festival related spending up to March 31, 2021.

The loan will be given to central government employees by the way of a prepaid RuPay card which would be used at point of sale machine and money cannot be withdrawn from ATMs. The loan will be repaid to the government in 10 monthly instalments, the government said.

Finance Minister Nirmala Sitharaman said that the prepaid RuPay card will remain active till March 31, 2021.

Special Festival Advance scheme is a one-time advance scheme for central government employees and was revived after it was discontinued after the recommendations of Sixth Pay Commission were accepted, Ms Sithraman said.

Under the previous Special Festival Advance scheme only non-gazetted officers were eligible to avail benefits of the scheme but this time all central government employees will be eligible for the scheme, Ms Sitharaman added.

The government also allowed its employees to spend travel allowances that are an income-tax-exempt part of their salaries on goods and services, Ms Sitharaman told a news briefing.

"This is expected to create a consumer demand of about Rs 28,000 crore," she said.