Microfinance institutions (MFIs) have extended loans to the tune of Rs.30,000 crore so far in the current fiscal.. Growth is expected to increase by 40 per cent next fiscal, Microfinance Institutions Network (MFIN) CEO Alok Prasad said here.“The portfolio of lending has gone up by 55 per cent this year. The good news is that payback tendency of over 99 per cent of the borrowers is strong. It is an encouraging scenario,” Mr. Prasad said. He, however, added that there was no change in ground situation in Andhra Pradesh, which has zero business for MFIs.
The 2010 MFI regulation by the Andhra Pradesh Government had a significant impact on microfinance companies in the State. These companies could not continue operations since then, and the total outstanding loans stood at Rs.7,000 crore.
The MFIs are pinning their hopes on the proposed Microfinance Bill. “The companies abide by the State law until a single regulation is established post-MFI Act. Till then, the MFIs cannot re-start the operations in Andhra Pradesh,” he said.
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The industry umbrella body is not hopeful of passing of the proposed Microfinance Bill in the current session of Parliament. “The Bill has undergone scrutiny by the RBI, industry and Parliament. But given the paucity of time, it may not be taken up in the current session,” Mr. Prasad said. Going by the RBI mandate on self regulatory organisations engaged in microfinance, the MFIN is mulling changes in its bylaws. The industry body in its extraordinary general meeting on Tuesday here is expected to discuss key issues related to inclusion of stakeholders in the self regulatory framework.