India's microfinance industry clocked 47 per cent growth with a gross loan portfolio of Rs 68,789 crore in the financial year ended March 2018 as against Rs 46,842 crore in the year-ago period, according to a report.
Releasing the report here Wednesday, Union MSME Minister Giriraj Singh said the interest rate at which bankers provide loan to microfinance institutions should be brought down so that more people can be brought under the ambit of microfinance.
"It is time that banks and MFIs should work in tandem. The banks are worried about NPAs. Let me tell SIDBI, those who take microfinance loans are not capable of leaving the country.
"Stop thinking about NPA when you are giving loans to MFIs. The loan takers will not run away from India like Nirav Modi or Vijay Mallya," Singh said in a statement issued by the organisers of the Bharat Microfinance Report 2018 launch event.
According to the report, the sector witnessed 56 per cent increase in loan disbursements in 2017-18 over the previous year. It stood at Rs 81,737 crore, the highest since 2015-16.
However, the top 10 MFIs disbursed Rs 55,013 crore, which is 67 per cent of sector's total amount disbursed, and rest of the other MFIs disbursed 33 per cent.
Among the regions, south still dominates the overall loan disbursement of MFIs with 34 per cent, followed by east with 30 per cent. Central and west have a share of 18 per cent and 9 per cent, respectively. While north and northeast have least disbursement share of 7 per cent and 2 per cent, respectively.
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