Microcredit gains momentum

The number of microcredit beneficiaries across the country rose significantly in one year to June 2016, according to the Microcredit Regulatory Authority (MRA) data.

The total number of loan recipients increased to 23.11 million in June 2016 from 20.35 million in June 2015, the data showed.

The number of members of micro-finance institutions (MFIs) increased to 27.511 million at the end of June 2016, up from 26 million a year earlier.

The rise in the number of microcredit recipients is mainly due to the government's favourable policy for the sector, an official said.

Easier availability of small credit than that of the country's commercial banks also led to the gradual rise in the number of the beneficiaries, he cited.

The borrowers are becoming less dependent on banks as the MFIs are ensuring their presence across the country, especially in rural areas.

The MFIs are helping the government enhance financial inclusion by bringing unbanked people under its coverage, he mentioned.

He, however, said many poor families depend on the MFIs for funds they require to continue with their small business or for other purposes in rural areas.

Most of the clients, especially women, start their business by taking loans from the MFIs, he added.

The beneficiaries are now able to raise their income and can provide financial help to their families.

Currently, a good number of small entrepreneurs are making different products and delivering services with the MFI finances.

The products are exported abroad after meeting the local demand, another source said.

The number of MFI branches increased to 16,240 as of June 2016 from 15,609 in 2015.

Again, the number of MFI employees increased to 122,335 in June 2016 from 110,781 in June 2015.

A total of 707 MFIs are registered with the MRA and 128 got licences on a temporary basis until March 2018.

Several attempts were made over phone for MRA executive vice-chairman Amalendu Mukherjee's comment, but to no avail.

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