Leading micro-finance institutions (MFIs) operating out of West Bengal have sought an increase in credit flow from banks, the only source of finance for these entities.
Secretary of Association of MFI, West Bengal (AMFI-WB) and chairman of Bandhan Financial Services C S Ghosh today said the only issue which these companies were facing was flow of credit.
"From the association we are asking banks to step up credit flow to MFIs so that more and more poor were able to avail micro-credit (facilities) and create income generating assets," he told reporters on the sidelines of a seminar here.
At present, the loan exposure of MFIs nationally was Rs 30,000 crore, involving 2.6 crore borrowers.
The target nationally is to bring five crore people under the ambit of micro-finance, he said.
Bandhan would soon transform itself into a bank.
Trustee of AMFI-WB and MD & CEO of Village Financial Services Kuldip Maity said there was a lot of apetite for credit among the poor and the credit flow from the banks was not sufficient enough to meet the demand.
"Two or three big MFIs are getting good bank credit, but the others are not", Maity said.
Last fiscal, the credit flow from the banks saw an increase of 30 per cent over the previous period, he added.
CEO of MFI Arohan Financial Services Shubhankar Sengupta said in the last three years there had been some positive developments in the sector.
"But funding from the banks is not sufficient. There is a huge market which needs to be tapped," he said and urged banks to allow MFI agents to act as business correspondents and collect deposits from the people on their behalf.
