Covid-19: MFIN hails pacakge for SHGs, says it will provide immediate support to millions of livelihoods

The economic pacakge for the women self-help groups (SHGs) as part of the government's Covid-19 support will help millions of women to keep their households running and it has addressed the immediate concerns of a large section of the society, the Microfinance Institutions Network (MFIN) said on Thursday.

The package provides an income cushion to the poor women and these steps will be comforting to millions of women microfinance borrowers' households whose livelihoods would be impacted due to this crisis,Microfinance Institutions Network (MFIN) said in a statement.

Under the Pradhan Mantri Gareeb Kalyan Yojana relief pacakge, Finance Minister Nirmala Sitharaman announced a Rs 1.70 lakh crore relief pacakge meant specially for the poor and vulnerable section of the society as their livelihoods are threatened due to the complete lockdown of non-essential economic activities.

For the women SHGs, the government has doubled the amount of collateral free loan to Rs 20 lakh so as to meet their business requirements.

The measures announced by the government today will address the immediate financial and physical livelihood concerns of a large section of our population especially the low-income households who form the bulk of our borrowers, with no safety net," said MFIN CEO Harsh Shrivastava.

MFIN members have already suspended all collections, thus doing their bit to increase the liquidity in the hands of borrowers.

Sitharaman, while addressing a news conference in the capital, said that the government do not want anyone to remain hungry and has also offered free rice, wheat and pulses for the targeted section of the society under its direct benefit transfer (DBT) scheme for the next three months.

India has come under the lockdown with effect from Tuesday that will go until mid of April.

She said the aid to the sector will provide an immediate support to 63 lakh SHGs benefiting 7 crore families.

The minister also hinted that the government will be open to more support if the need arises.

MFIN is an industry association comprising 56 NBFC-MFIs and 35 associates including banks, Small Finance Banks (SFBs) and NBFCs.