Connect with us

Finance

Microfinance sector: Average collection efficiency improves to 95% in Q2 from 85% in Q1

Published

on


Talking to FE, Satish said collection efficiencies in Assam and Kerala improved in the second quarter compared to the first, but the figures lagged far behind the national average due to “external issues”.Talking to FE, Satish said collection efficiencies in Assam and Kerala improved in the second quarter compared to the first, but the figures lagged far behind the national average due to “external issues”.

The country’s microfinance sector saw a significant improvement in loan repayments in the second quarter of the current fiscal year, when average collection efficiency for micro loans increased to over 95% from around 85% in the first quarter.

Asset quality of the lenders of the sector improved on a sequential basis with portfolio at risk (PAR) above 30 days falling to 10.18% as on September 30 from 16.56% as on June 30, 2021, according to the quarterly review of the sector by Sa-Dhan, a self-regulatory organisation for the sector.

At the end of the second quarter, this fiscal year, the micro credit portfolio of the lenders stood at Rs 2,25,331 crore, down by 1.1% year on year. Total disbursement of all lenders, however, grew 95.4% YoY to Rs 66,694 crore in the second quarter of FY22 compared to Rs 34,135 crore during the same period of FY21. Average ticket size also rose to Rs 35,106 from Rs 34,756.

Sa-Dhan executive director P Satish said, “The sector which was affected in Q1 of this financial year due to the second Covid wave, has seen improvement in repayments and fresh disbursements. The decline is slowing down, although there remains stress on fund access and operations of mid- and small- MFIs.”
Satish said Sa-Dhan hoped and expected a gradual recovery by the third quarter as borrowers’ incomes further stabilised. “We have written to the government to sanction an additional `7,500 crore under the Credit Guarantee Scheme for the sector,” he said.

Talking to FE, Satish said collection efficiencies in Assam and Kerala improved in the second quarter compared to the first, but the figures lagged far behind the national average due to “external issues”.

The Assam government has started the process of providing the one-time relief to the stressed microfinance borrowers in the state after it had signed a memorandum of understanding with microfinance lenders in August for implementation of the relief scheme. For Kerala, high number of Covid positive cases and the recent flood impacted loan repayments.

For the industry as a whole, portfolio at risk (PAR) above 60 days improved to 4.72% as on September 30 from 6.41% as on June 30, 2021. And, PAR above 90 days stood at 2.96% at the end of the second quarter as against 3.01% at the end of the first quarter this fiscal year.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.





Source link

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Finance

SBI, Adani Capital sign pact for co-lending to farmers

Published

on

By


The Reserve Bank of India (RBI) had issued guidelines on co-lending scheme for banks and NBFCs for priority-sector lending, to improve credit flow towards underserved sectors of economy, the bank said in a release, adding that the model aims to give the borrower the best interest rate and better reach.The Reserve Bank of India (RBI) had issued guidelines on co-lending scheme for banks and NBFCs for priority-sector lending, to improve credit flow towards underserved sectors of economy, the bank said in a release, adding that the model aims to give the borrower the best interest rate and better reach.

State Bank of India (SBI) on Thursday signed an agreement with Adani Capital, the non-banking finance company (NBFC) arm of the Adani Group, for co-lending to farmers for purchase of tractors and farm implement.

“This partnership shall help SBI to expand customer base as well as connect with the underserved farming segment of the country and further contribute towards the growth of India’s farm economy. We will continue to work with more NBFCs in order to reach out to maximum customers in far flung areas and provide last mile banking services,” said SBI chairman Dinesh Khara.

The Reserve Bank of India (RBI) had issued guidelines on co-lending scheme for banks and NBFCs for priority-sector lending, to improve credit flow towards underserved sectors of economy, the bank said in a release, adding that the model aims to give the borrower the best interest rate and better reach.

Registered in 2017, Adani Capital is a non-deposit taking systemically important NBFC with total assets under management (AUM) of Rs 1,292 crore as on March 31. The NBFC had 28,000 customers spread across 63 branches in 6 states including Maharashtra, Gujarat, Rajasthan, Karnataka, Tamil Nadu and Uttar Pradesh.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.





Source link

Continue Reading

Finance

Srei: Administrator admits Rs 22,910 cr claims from banks

Published

on

By


Citing governance concerns and defaults by the two NBFCs in their various payment obligations, the RBI superseded their boards and appointed Sharma, former chief general manager, Bank of Baroda, as the administrator.Citing governance concerns and defaults by the two NBFCs in their various payment obligations, the RBI superseded their boards and appointed Sharma, former chief general manager, Bank of Baroda, as the administrator.

The Reserve Bank of India-appointed administrator has admitted total claims of Rs 22,910.49 crore of commercial banks’ on Srei Infrastructure Finance and its wholly-owned subsidiary Srei Equipment Finance, against the combined amount of Rs 25,115.29 crore claimed by them.

Administrator Rajneesh Sharma has rejected claims of around Rs 1,604.63 crore by the commercial banks, while Rs 601.37 crore is under verification as of November 19.

The Kolkata bench of the National Company Law Tribunal (NCLT) on October 8 gave its approval to start insolvency proceedings against Srei Infrastructure Finance and Srei Equipment Finance after the Reserve Bank of India (RBI) filed insolvency applications against them.

The central bank filed the insolvency petitions just after the Bombay High Court dismissed a writ petition filed by two promoters of Srei group challenging the RBI’s decision to supersede the boards of these companies and initiate insolvency proceedings against them.

The second meeting of the committee of creditors of Srei Equipment Finance was convened and conducted on Monday.

At the meeting, the administrator apprised the committee of creditors of the current status of the Corporate Insolvency Resolution Process (CIRP), the composition of the committee based on the claims received, and the way forward on the resolution strategy — including group resolution and timelines — according to a stock exchange filing by Srei Infrastructure Finance.

On a request made by public sector lender Uco Bank, the RBI had filed applications for initiation of the CIRP under the Insolvency and Bankruptcy Code against the two companies through Sanjay Ginodia, senior partner of R Ginodia & Co.

Citing governance concerns and defaults by the two NBFCs in their various payment obligations, the RBI superseded their boards and appointed Sharma, former chief general manager, Bank of Baroda, as the administrator.

The central bank has also constituted a three-member advisory committee to assist the administrator. The committee members are R Subramaniakumar, former MD & CEO, Indian Overseas Bank; T Srinivasaraghavan, former MD, Sundaram Finance; and Farokh N Subedar, former COO and company secretary, Tata Sons.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.





Source link

Continue Reading

Finance

PSB privatisation: New Bill may provide for 26% minimum govt holding

Published

on

By


Presenting the Budget for 2021-22, finance minister Nirmala Sitharaman had announced the privatisation of two PSBs and one general insurer, as part of the Centre’s disinvestment plan to rake in Rs 1.75 lakh crore.Presenting the Budget for 2021-22, finance minister Nirmala Sitharaman had announced the privatisation of two PSBs and one general insurer, as part of the Centre’s disinvestment plan to rake in Rs 1.75 lakh crore.

The Banking Laws (Amendment) Bill, 2021, which will be introduced in the Winter Session of Parliament starting November 29, will likely propose that the minimum government holding in public sector banks (PSBs) be trimmed to 26% from 51%, an official source said.

The move is aimed at facilitating the privatisation of two PSBs, in sync with the announcement in the Budget for 2021-22. On Wednesday, shares of Indian Overseas Bank (IOB) and Central Bank of India rallied, amid speculations that the government had made a decision to privatise these two lenders, as suggested by the Niti Aayog. However, the Centre is yet to formally name the privatisation candidates.

While the draft Bill provides for the lower shareholding, a final call will be taken by the Cabinet, which will clear the Bill before it can be introduced in Parliament, added the source.

“(However) If it’s found, after consultations with investors, that they are not interested unless the government sells its entire stake in the select PSBs, the government is open to consider complete privatisation as well. But initially, it may opt for retaining a 26% stake,” said another source who is privy to discussions.

Analysts fear any government proposal to retain 26% stake in the PSBs may not go down well with potential suitors. For instance, the government was forced to put its entire stake in state-run Air India on the block after its initial plan to hold at least 26% in the national carrier didn’t elicit any response from investors.

The new Bill proposes to “effect amendments in Banking Companies (Acquisition and Transfer of Undertakings) Acts, 1970 and 1980 and incidental amendments to Banking Regulation Act, 1949 in the context of Union Budget announcement 2021 regarding privatisation of two Public Sector Banks”, according to the list of legislative business for the winter session of Parliament.

These laws had led to the nationalisation of banks, so relevant provisions of these laws have to be changed to pave the way for the privatisation.

Presenting the Budget for 2021-22, finance minister Nirmala Sitharaman had announced the privatisation of two PSBs and one general insurer, as part of the Centre’s disinvestment plan to rake in Rs 1.75 lakh crore.

Already, Parliament had in its last session cleared a Bill to facilitate the privatisation of state-run general insurance companies by removing the requirement of the central government to hold at least 51% stake in an insurer.

Niti Aayog has already recommended the sell-off of IOB and Central Bank of India to the core group of secretaries on disinvestment, headed by the Cabinet Secretary. This core group will send its recommendation to the alternative mechanism (AM), headed by the finance minister, for its approval. Finally, it will be cleared by the Cabinet.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.





Source link

Continue Reading

Trending