Banks seek extension of microloan guarantee scheme
In short
IDFC First Bank and several small finance banks want the microloan guarantee scheme extended. The report says AU, Jana and Suryoday were among the biggest users of the scheme, and they have already set aside the guarantee fee for this fiscal year.
This matters because the scheme helps lower credit risk on microloans. It is still not known when or if the government will reopen the window.
What the reporting says
IDFC First Bank and small finance banks including AU, Jana and Suryoday sought an extension of a microloan guarantee scheme in a publisher-supplied Economic Times summary. They were among the biggest users of the scheme to reduce credit risk and have already set aside the guarantee fee for the current fiscal year, expecting the government to reopen the window soon. The immediate issue is ongoing access to the scheme, while the government’s response is not stated.
Why it matters
The Economic Times summary says IDFC First Bank and small finance banks such as AU, Jana and Suryoday are seeking an extension of a microloan guarantee scheme. The banks used the scheme to reduce credit risk and have set aside the fee for the current fiscal year, expecting the government to reopen the window soon. The source does not state whether the extension has been approved or when a decision may come.