We saw in the earlier chapters that CEF is a fund given on the lines of the Community Investment Fund, and it is meant only for enterprise promotion.
It is given to support entrepreneurs with much-needed seed capital for their business. Hence, it is important to ensure that CEF is utilized properly.
Let us understand some do’s and don’ts related to the management of CEF.
Do’s
- CEF should be given only after the business plan has been submitted and vetted in the PAC/PSC (Project Approval/Sanction Committee Meeting).
- CEF should always be kept in an auto swipe fixed deposit account so that the interest earned on CEF from the bank is maximum.
- The interest earned from banks on CEF should only be added to the corpus of CEF and cannot be diverted for any other purpose.
- Loans given from CEF should be utilized only for expenses directly related to the business.
Don’ts
- No decision related to giving loans from CEF should take place without the consent of all members of BEPC.
- CEF should never be given to an entrepreneur through cash transaction.
- CLF/VO/SHGs should not use any CEF money given to them for transferring to the entrepreneurs for any other purpose or project.
- No CEF loans should be given without proper documents or if documents are found to be incorrect.