microfinance institutions have Rs 33,000 crore of bad loans despite better collections

About 12% of the overall microfinance loans of rs 2.76 lakh crore have remained non-performing asset (npa) on the end of june regardless of development in overall repayment collection, microfinance industry body sa-dhan stated.

This translates into rs 33,000 crore of npa.

“Recovery has improved compared to the previous quarter and reached almost 99% in some states. However, there are still certain geographies where collection is below the normal.

Assam, west bengal, kerala, tripura, and chhattisgarh are most of the primary states that have shown under common recovery and are a drag on the overall asset quality.

The overall sectoral npa is around 12% as of the end of june 2022, but nbfc-mfis as a group have 9% in their rs 9,7849 crore portfolio as npa.

The sector has grown 24% yr-on-yr to rs 2.76 lakh crore on the quit of june from rs 2.22 lakh crore.

“the world has overcome the difficulties of pandemic and is now on the right track. Even though it become busy in enforcing the new rbi policies at some stage in q1, it has clocked a healthy boom,” sa-dhan executive director jiji mammen stated.

though funds flow to the sector has progressed, but nonetheless a few smaller mfis discover it hard in having access to finances from banks. We are running in the direction of removing this gap, he said.

Portfolio of all lenders recorded double digit increase, except for banks. Non-bank lenders have shown 55% soar in mortgage awesome accompanied by nbfc-mfis, small finance banks and now not-for-profit mfis which have recorded 35%, 28% and 21% boom respectively.