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RBI gives breather to MFIs

Asks banks to recast unsecured loans without NPA classification. The Reserve Bank of India (RBI) has asked banks to go easy on microfinance institutions (MFIs) by relaxing certain norms regarding loan restructuring. Banks can now restructure loans extended to MFIs even if they are not fully secured. As a special case, banks need not classify such loans as non-performing assets (NPAs). “This relaxation was given considering the fact the problems afflicting MFIs were not necessarily on account of any credit weakness per se but mainly due to environmental factors,” RBI said in a ...