With the completion of one year of demonetisation, leading players of the micro-finance industry (MFI) were of the view that things were recovering slowly and delinquency levels were still on the higher side.

Arohan Financial Services, a city-based MFI, was already feeling the heat as the demonetisation exercise was having a telling effect on its financials.

"Demonetisation has severely affected the poor women as they were not being able to repay in the old 500 and 1000 currency notes from November nine last year. As a result, they were failing in paying the instalments", MD of Arohan Manoj Nambiar told PTI.

Prime Minister Narendra Modi announced demonetisation of Rs 500 and Rs 1000 currency notes on November eight last year. Nambiar said the company had to work with these borrowers so that they were able to make the repayments. "Our customers are those who belong to the bottom of the pyramid. It was not possible for them to leave their daily chores and stand in the long queues to get old notes exchanged", he said. Even the livelihood of the genuine customers got affected due to demonetisation, he said.

"However, things are recovering now but very slowly. It is improving each month. Even today, the delinquency levels are high for which we are required to make higher provisioning, which in turn is affecting out financials", he said. Kuldip Maity, MD and CEO of Village Financial Services, another city-based MFI, said that industry was shaken by the sudden announcement.

"As this sector is cash driven, the whole industry faced tremendous challenges in the first few months of demonetisation. There were issues related to both loan disbursement and repayment", Maity said. "But, it is heartening to watch the industry recovering fast. We have been able to overcome the initial impact of demonetisation", he added.