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RBI warns of NPA spike in MUDRA loans
Why is it in the news ?
- The RBI has raised a concern over spike in non-peforming assets (NPAs) under the government’s flagship scheme to support micro enterprises in the country- the Pradhan Mantri Mudra Yojana(PMMY).
More in the news
- RBI has cautioned that the scheme might turn out to be the next big source of NPAs that have plagued the banking system.
- RBI said that bad loans under PMMY had risen to Rs.11,000 crore.
- The caution comes at a time when the country’s financial system is reeling under severe stress due to IL&FS crisis.
- As per the annual report of PMMY, 2017-18, total disbursements under the scheme stood at Rs 2.46 trillion in FY 18.
- Out of this, 40% were disbursed to women entrepreneurs and 33% to social categories.
- More than 4.81 crore micro borrowers have benefited through PMMY during the year FY2017-18.
MUDRA Yojana
- The yojana was launched on April 8, 2015.
- Under the scheme, banks are required to finance micro and small entrepreneurs for up to Rs 10 lakh.
- Loans can be granted under three categories -(1) Up to Rs 50,000 under 'Shishu'.(2) Rs 50,001-Rs 5 lakh under 'Kishore'.(3) Between Rs 5,00,001 and Rs 10 lakh under 'Tarun' category.
Source
Economic Times.