States seek urgent funds to sustain women livelihood mission, no word on NULM 2.0 yet

Five states are urgently seeking funds because the urban livelihood mission’s regular financing has become unclear after DAY-NULM ended and its proposed replacement stalled. States say this threatens support for urban poor households, especially women organised through self-help groups. They also face unpaid liabilities and shortages for continuing mission services.

Tamil Nadu requested Rs 350 crore, Maharashtra Rs 81 crore, Madhya Pradesh Rs 101 crore and Tripura Rs 6.5 crore. Their letters warn that a funding pause could disrupt bank linkages and access to institutional credit. It could also affect staff remuneration, interest subsidies and revolving funds.

The pressure follows the end of DAY-NULM in October 2024 and the DJAY-S pilot in December 2025. With no clear new national scheme, states are trying to keep existing institutions, staff and services functioning. They argue that financial support is needed to protect gains already made and sustain livelihoods.

The Deendayal Antyodaya Yojana–National Urban Livelihoods Mission, or DAY-NULM, was a national programme that ran from 2014 until October 2024. Its purpose was to improve livelihoods and social protection for the urban poor. It placed strong emphasis on women’s self-help groups and community-led support.

The mission helped create more than 10 lakh women’s self-help groups. It supported bank linkages and access to institutional credit. Its support also included interest subsidies under the self-employment programme, revolving funds, area-level federations, community resource persons and bank sakhis. These structures helped connect low-income people with finance and livelihood opportunities.

The mission’s future is now uncertain. MoHUA ran the DJAY-S pilot after DAY-NULM, until December 2025, but sources said the proposed new scheme was no longer under consideration. States therefore want funds to keep existing groups, personnel and urban livelihood services operating.

DAY-NULM reached a very large network of women in urban communities. The article reports that more than one crore women benefited over the last decade. It also says the mission created over 10 lakh women’s self-help groups before it ended in October 2024.

These groups formed the local foundation for livelihood and financial support. They connected women with bank linkages, institutional credit and community institutions. The wider system also included area-level federations, community resource persons and bank sakhis. Together, these structures helped sustain livelihood activities and social protection for the urban poor.

Tamil Nadu illustrates the scale at state level. It has 1.72 lakh self-help groups with 18.70 lakh members under the National Urban Livelihood Mission. During the DJAY-S pilot, Tamil Nadu also identified about 1.26 lakh vulnerable occupational families and formed around 2,500 self-help groups.

Urban poor households could lose reliable support for building or maintaining livelihoods if mission funding stops. The states warn that the damage would go beyond delayed government payments. Existing self-help groups and community institutions could weaken, reducing the support available to vulnerable families, particularly women.

The key mechanism is financial access. Mission structures help groups connect with banks and institutional credit. Interest subsidies make eligible loans more manageable over the applicable loan period. Revolving funds and group activity support provide additional financial backing. If these systems are interrupted, households may struggle to maintain livelihood activities or secure continuing credit.

Tripura warned that the benefits and progress achieved through the mission could be severely undermined. Its groups work in mid-day meals, canteens, school uniform stitching and municipal services. The states therefore seek funds to protect bank linkages, community institutions and uninterrupted support for beneficiaries.

States are facing financial problems because DAY-NULM ended while obligations connected to its work continued. Loan-linked interest subsidies may remain due during the applicable loan period. Staff must also be paid, and existing groups and services need support even when no new national scheme is operating.

Madhya Pradesh specifically sought Rs 13.71 crore for interest subsidy under NULM’s self-employment programme. It said the subsidy mechanism was linked to bank loans and intended to provide continuing relief to eligible beneficiaries. Maharashtra reported that staff remuneration, interest subvention and revolving-fund liabilities were piling up each month.

The uncertainty over a replacement made planning harder. Maharashtra said it had last received NULM funds in March 2024 and had exhausted them. Tamil Nadu reported that its NULM funds were completely exhausted by April 2025. States now seek releases to clear dues and preserve services.

The Deendayal Jan Aajeevika Yojana–Shehari, or DJAY-S, was a pilot launched after DAY-NULM. It ran until December 2025 and was meant to pave the way for a new scheme. The pilot aimed to extend urban livelihood work while a longer-term national programme was prepared.

The pilot involved identifying vulnerable occupational families and forming self-help groups. In Tamil Nadu, Chennai and Tiruppur were selected, around 1.26 lakh vulnerable occupational families were profiled, and about 2,500 groups were formed. MoHUA also advised states to retain existing mission structures and workforces for continuity.

The problem is that sources said the proposed new scheme was no longer under consideration. This leaves states supporting existing groups, staff and beneficiaries without clear future financing. Maharashtra said it wanted Central funds to pay previous dues and start the new scheme afresh, while other states requested committed funds.

These tools work together to help low-income people build livelihoods. Self-help groups create organised community institutions around which women and other vulnerable workers can act collectively. They also provide a channel for livelihood promotion, financial inclusion and social protection in urban areas.

Bank linkages connect groups and beneficiaries with institutional credit. Interest subsidies provide continuing relief on eligible bank loans during the applicable loan period. Revolving funds add financial support for group activities. Area-level federations, community resource persons and bank sakhis strengthen this system by helping communities manage support and maintain connections with banks.

The article gives practical examples from Tripura. Its 6,796 groups worked in mid-day meal services, canteens, school uniform stitching and municipal service delivery. States warn that stopping funds could disrupt these links and weaken institutions built over several years, threatening the progress already achieved.