Pending repayments remain high for MFIs: RBI staff report

MFIs faced problems in getting repayment in some pockets of India because of currency shortage

The financial sector may gradually be recovering from the effects of demonetisation, but microfinance companies, whose customers depend on cash transactions, are still grappling with pending payments with high risk of defaults.  

A research paper by the Reserve Bank of India (RBI) staff said such customers often fall in the category of small farmers and unskilled labour. 

Microfinance institutions faced problems in getting full repayment from clients in some pockets of the country because of currency shortage. As the time progresses, the prospects of recovery from people who stay in default reduce, said bankers.  

The RBI relaxed the