NPAs in self-help groups fall to 6.4% in FY16

Loan disbursement to self-help groups (SHGs) by banks grew 35 per cent in 2015-16 to Rs 37,287 crore. While the overall non-performing assets (NPAs) of public-sector banks grew to 5.43 per cent in FY16, up from 4.72 per cent in the previous year, NPAs of bank loans to SHGs declined by about 100 basis points from 7.4 per cent as on March 31, 2015 to 6.4 per cent as on March 31, 2016.

On the other hand, overall bank deposits of SHGs rose by as much as 23.79 per cent to stand at Rs 13,691 crore as on March 31, 2016, whereas the average savings outstanding per SHG rose 21 per cent during the year to Rs 17,324 from Rs 14,368 a year ago. According to the National Bank for Agriculture and Rural Development (Nabard)'s report titled Status of Microfinance in India 2015-16, savings among women SHGs increased 29.92 per cent to Rs 12,035.78 crore during 2015-16, up from Rs 9,264.33 crore in 2014-15.

"A few years ago, higher NPAs in loans disbursed among SHGs were a matter of concern. However, in recent times, we have started local approach with the SHGs. Taking banks, NGOs and state government together with us, we have conducted interactions and tried to understand the needs of SHGs. Similarly, banks have also expressed their expectations and the outcome is reflected in the rise in savings and fall in NPA," said H R Dave, deputy managing director of NABARD.

The gross NPAs as on March 31, 2016 were Rs 3,686.2 crore, which witnessed a decline of 3.4 per cent from Rs 3,814.7 crore a year ago. The southern region accounted for 48.4 per cent of the gross NPAs in the country.

  However, its share declined substantially from 60 per cent a year ago. On the other hand, the share of all other regions in gross NPAs increased. The eastern region accounted for 24.2 per cent. The north eastern and northern regions recorded a rise in gross NPAs during the year.

There was an overall 35 per cent increase in the amount of loan disbursed by banks to SHGs during the year, taking it to Rs 37,287 crore against Rs 27,582 crore in the previous year. The average loan disbursement per group during 2015-16 was Rs 2.03 lakh, which showed a healthy increase of 20 per cent from Rs 1.69 lakh in 2014-15. During 2015-16, banks provided loans to 1.83 million SHGs compared to 1.62 million SHGs in 2014-15.