Bharat Financial released an update on collections post demonetisation; collection efficiency on dues where two weeks have elapsed was 97%: In its update, BHAF provided the details of collections for installments falling due November 11-25. BHAF runs a weekly collection model.
There has been a significant pick up in collections. In the first week, collections ran below actual dues, with the installment collection gap narrowing progressively. In the second week, collections were higher than dues as borrowers repaid a large part of the previous week’s overdues.
BHAF declared a moratorium in 92 per cent of the branches on November 11. As a result, collection efficiency was <10 per cent on that day. Following additional collections in the coming weeks (November 18 and 25), 97 per cent of November 11 dues have been collected, 93 per cent of November 18 dues have been collected and 80 per cent of November 25 dues have been collected. Cumulative collective efficiency for the centres having installments due on Fridays (beginning November 11), improved from <10 per cent to 84 per cent and 89 per cent as of November 18 and 25, respectively.
BHAF is disbursing only in those centres where collection efficiency is 100 per cent. It is disbursing by recycling cash collections, as there are limits on current account withdrawals (up to Rs 50,000/week). Disbursement to customer bank accounts are also limited due to ATM withdrawal limits and limited availability of cash at bank branches.