The total number of loans disbursed by NBFC-MFIs were 2.04 lakh in Q1 FY21, compared with 59 lakh in the same period last year.
The company has already disbursed loans to the tune of Rs 150 crore in the ongoing quarter with the help of its partners.
The non-banking financial companies-microfinance institutions (NBFC-MFIs) disbursed 96 per cent fewer loans in the first quarter of the current fiscal, compared to the same period a year ago. Loans worth Rs 570 crore were disbursed in Q1, which was Rs 15,856 crore a year ago, PTI reported citing a report by Microfinance Institutions Network. MFIN a self-regulatory organisation and industry association, comprising 56 NBFC-MFIs and 35 associates including banks, small finance banks (SFBs), and NBFCs as its members. While the Reserve Bank has been continuously trying to push bank credit, the disruption caused by the ongoing pandemic hurt the loan offtake.
The total number of loans disbursed by NBFC-MFIs was 2.04 lakh in Q1 FY21, compared with 59 lakh in the same period last year. However, the average loan amount disbursed per account during the quarter was higher than the last year. In Q1FY21, the average loan was Rs 27,996, which is an increase of nearly 4 per cent than the last year.
With the nationwide lockdown hurting the livelihood of the clients, the first quarter has been unprecedented both for microfinance lending institutions and microfinance borrowers, said MFIN Chief Executive Officer Alok Misra. The moratorium was not extended to MFIs by all the banks which caused a double squeeze for MFIs, he added.
It is not only the microlenders but also the schedule commercial banks which are struggling with the low bank credit. SBI Chairman Rajnish Kumar today said that that interest rate cuts had not led to an increase in investment, despite the banks passing on the rate cuts to the customers. He said that credit growth has been slow this year as capital expenditure was not happening at the usual pace. The SBI Chairman added that the banks are being prudent as during the 2008 crisis, banks had increased lending by diluting norms and the country had paid a high price for that.