"There is no banking facility present in remote areas and therefore, these companies can play a major role in providing financial services in these areas and to the last man in the society," said Reserve Bank of India (RBI) Regional Manager Murali Ramkrishna here today.
These companies fulfil financial needs of people of the lowest strata by providing small loans without any guarantees, but despite that, their loan recovery rate is 98 per cent, which is highly surprising, he said while addressing a session on 'Micro Finance: Financial Inclusion Agenda' organised by the Microfinance Institution Network (MFIN).
The body is an umbrella organisation of 55 non-banking finance companies (NBFC) and microfinance companies. It has disbursed Rs 45,000 crore as loans to more than 4.5 crore customers in the country.