Financial Services Secretary advised microfinance institutions to avoid giving loans recklessly.

New Delhi : Financial Services Secretary M Nagaraju has issued a notification for Microfinance Institutions. He said that the financial institutions giving loans of small amounts i.e. MFIs have played an important role in promoting financial inclusion, but advised these institutions to avoid giving rash loans.

Speaking at a program of 'Sa-Dhan' here, he said, “We all should be careful in this matter. “Giving loans to Self Help Groups (SHGs) or Joint Borrowing Groups (JLGs) without thinking or strictly following the rules to manage the risks can cause losses to the sector.”

Provide necessary finance

He said anything that affects their ability to pay will actually hurt MFIs. “Therefore, we must be very careful about what, when and how we lend,” the Financial Services Secretary has said. This is because their financial literacy is limited, we should really try to empower them. Provide the necessary finance and ensure they are supported so that they can flourish and grow.”

Also read:- These billionaire brothers and sisters were born on the same day, know how many crores they are worth.

more than 77 lakh groups

Nagaraju said that there are more than 77 lakh groups under the program of linking self-help groups with banks. They have outstanding loans of Rs 2.6 lakh crore. About 10 crore poor families are getting benefits from this. He said that jointly borrowing groups are also playing an important role in benefiting about 8 crore poor families with an outstanding loan amount of Rs 4.4 lakh crore.

able to advance

Nagaraju said that the government is also implementing Lakhpati Didi Scheme with the aim of women empowerment. The objective of this scheme is to transform Self Help Group members into women entrepreneurs so that they are able to establish and grow their businesses.

RBI Governor had given the statement

Just a few days ago, RBI Governor Shaktikanta Das has said that the growth in bank loans to non-banking financial companies (NBFCs) will reduce from 29 percent to 18 percent as compared to earlier.

(with agency input)