Local micro lenders likely to outpace Asian peers in CY21
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India’s micro finance institutions are expected to expand their loans by 18-38 percent by this year’s end, show an estimate by Singapore-based Robocash, a global fintech group of companies focused on providing alternative lending services.
Agencies
India’s MFI market makes up about 41% of the industry in Asia. It includes both non-banking lenders and banks.
Last mile lenders in India are likely to recover faster than their peers in Asia dispelling fears of an extended economic cost of the second wave of COVID19.
India’s micro finance institutions are expected to expand their loans by 18-38 percent by this year’s end, show an estimate by Singapore-based Robocash, a global fintech group of companies focused on providing alternative lending services.
Are loan repayments in lockdown mode?
May 10, 2021
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With the pandemic still not under control, collection efficiency of MFIs may be hit and risk perception for the sector remains high
The spurt in fresh infections following the second wave of Covid-19 pandemic and the lockdown being announced in several States mayimpact the collection efficiency of microfinance institutions.
Industry experts, however, feel it is still too premature to gauge the exact impact on loan growth and repayments, as there is still a lot of uncertainty around when the second wave will peak out.
According to Alok Misra, CEO and Director, MFIN (Microfinance Institutions Network), the first quarter is likely to be tepid as there is still uncertainty, but going by various mathematical and statistical predictions, the curve is likely to flatten out in end May or early June. Post that there could be a pick-up in business activity, given that there is a lot of pent-up demand.
Read more about RBI s Covid relief: SFB loans to MFIs get priority sector status on Business Standard. Special liquidity for SFBs to help low-income groups, say experts
RBI measures timely, will help manage stress in the economy, say bankers
May 05, 2021
The microfinance institutions network (MFIN) has also expressed its approval - PAUL NORONHA×
Step to augment the lending firepower of SFBs, a welcome move: SBI Chairman
Bankers have welcomed the slew of measures announced by the Reserve Bank of India (RBI) on Wednesday noting that the Central bank has continued to calibrate its policy throughout the Covid-19 pandemic and will help to manage the stress in the economy.
“The decision to create a dedicated ₹50,000 crore fund for ramping up the Covid-related healthcare infrastructure reflects the RBI’s commitment to transcend boundaries by addressing not only economic health but also public health. The decision to augment the lending firepower of Small Finance Banks (SFBs) through the priority sector tag is a very welcome move,” said Dinesh Khara, Chairman, State Bank of India. He added that the restructuring framework, the CRR flexibi
RBI tells MFIs to improve governance, loan appraisal system; assesses pandemic-led stress
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The central bank governor Shaktikanta Das called on these lenders Monday to assess the ground level situation going beyond the accounting numbers of micro lenders following the sharp rise in the rate of infections across regions, which forced local authorities to go for area wise containments and partial lockdowns.
Agencies
The existing provisions of relief in cases of natural calamities could be applied, they urged RBI.
The Reserve Bank of India has stressed that microfinance lenders need to follow appropriate governance and risk management standards even as these lenders are facing challenges with falling repayment collection while the raging second wave of the Covid-19 pandemic is affecting livelihoods.