The State Bank of India (SBI) has an exposure of Rs 300 crore to the troubled MFI sector in Andhra Pradesh and the lender feels the loans were “safe”. Loans have been given to two MFIs in the state, K Shiv Kumar, deputy managing director said on Thursday.
“We don’t have much exposure (to MFIs) compared to some other banks in the state. We have about Rs 300 crore in Andhra Pradesh and have already disbursed the loans,” he told journalists at the launch of the cyber payment services of the Andhra Pradesh Commercial Tax department here on Thursday.
However, Kumar admitted the situation was “grim” at the ground level after the state promulgated an ordinance last month to regulate MFIs, accused of deploying coercive methods to recover loans.
The top official said there were no pending applications from any MFI for further loan. “We have lent to two companies. Whenever there is requirement we do give loans. There is no new loan proposal from the MFIs. We believe the money is safe.”
He declined to divulge the names of the two companies. SBI’s associate, State Bank of Hyderabad, had earlier said it had a Rs 70-crore exposure in the MFI sector in the country.