Business Standard

Saturday, January 18, 2025 | 06:41 AM ISTEN Hindi

Notification Icon
userprofile IconSearch

Microfinance Industry most vulnerable to lockdown and moratorium

As first order impact, collection cycle may be hit, while lack of moratorium-relief from banks may squeeze out liquidity

Representative Image
Premium

Bandhan Bank said it has stopped fresh disbursement/collection but has not seen MFI customers dipping into their savings yet

Hamsini Karthik
Stocks in the microfinance space — whether CreditAccess Grameen or Spandana Sphoorty — and banks with high microfinance institution (MFI) exposure, such as Bandhan Bank, have shed 46–60 per cent in the past one month.

This, despite managements of Bandhan Bank and CreditAccess Grameen repeatedly trying to assuage investor concerns on their business outlook and explaining why a countrywide lockdown may only be a temporary hit on their financials.

In a recent call with analysts, Bandhan Bank said it has stopped fresh disbursements/collections, but has not seen MFI customers dipping into their savings yet. “As a long-term strategy, the bank has already

What you get on BS Premium?

  • Unlock 30+ premium stories daily hand-picked by our editors, across devices on browser and app.
  • Pick your 5 favourite companies, get a daily email with all news updates on them.
  • Full access to our intuitive epaper - clip, save, share articles from any device; newspaper archives from 2006.
  • Preferential invites to Business Standard events.
  • Curated newsletters on markets, personal finance, policy & politics, start-ups, technology, and more.
VIEW ALL FAQs

Need More Information - write to us at assist@bsmail.in