MFI operations come to halt in lockdown districts; biz severely impacted

Estimates suggest the locked down districts account for close to 50% of microfinance business in India; banks and SFBs could also be impacted

The lockdown to contain the spread of Coronavirus has put the microfinance sector on the edge.

Both collection and disbursements of loans in 75 districts across India under lockdown is temporarily suspended, according to Manoj Nambiar, chairman, MFIN (Microfinance Institutions Network), the representative body of MFIs.

Rough estimates suggest, the districts in which lockdown has been imposed, account for close to 50 per cent of microfinance business in India, according to Jagadish Ramadugu, MD and CEO, Vaya, a microfinance firm.

The gross loan portfolio of the microfinance industry at the end of  December 2019 was Rs 2.11 trillion. Every month close to 10