Guwahati: A total of Rs.12,500 billion in microfinance loans, consisting of principal and interest, are outstanding in Assam as of March 31, ministers Ashok Singhal said on Friday.
26 lakh customers with 45 lakh bank accounts have borrowed from 40 lenders, Singhal said at a news conference here.
Singhal said 53 percent of the outstanding amount of Rs.12,500 billion was borrowed from banks, 22 percent from non-bank financial firms (NBFCs) and microfinance institutions, 26 percent from small financial banks, and 16 percent from regular NBFCs.
The Minister of Irrigation and Urban Development heads a body to review the financial situation in order to fulfill the BJP’s election promise to forego microfinance loans.
Prime Minister Himanta Biswa Sarma had decided to appoint the body in the first cabinet meeting on May 11th with Singhal as chairman and the chief secretaries of the finance and Panchayat departments as well as the department for rural development as members.
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“The prime minister had instructed us to prepare a package to help the poorest possible women who had taken out loans and are facing immense misery,” said Singhal.
The committee held three rounds of meetings with stakeholders including banks, NBFCs, small cooperatives, microfinance institutions and the RBI.
“We had asked for the data they provided, but we realized that more data mining was needed and that this will soon be provided by stakeholders. Talks are ongoing and we expect the problem to be resolved at the earliest, ”he said.
Certain criteria must be followed when lending to borrowers as per RBI guidelines, but it is certain that norms have been violated, which has created problems for poor borrowers, he said.
The basic norm to be followed is that a woman cannot be a member of more than one support group (SHG) and should not lend more than two NBFCs to the same borrower.
According to the data provided, 19.10 lakh customers have borrowed from one lender, 5.08 lakh from two lenders, 1.54 lakh from three lenders, and 60,000 from more than three lenders.
The minister said action will be taken against the lenders who have violated the norms in the legal framework as most of the women who have taken out loans have no education and are unaware of the terms.
He said the relief provisions will be discussed and only those loans taken out before December 31, 2020 will be considered.
He said those with a family income of Rs a lakh, who pays income tax, owns four-wheelers, or other such policies set by the RBI will not be considered for loan waiver.