MFIs mode to banking rural poor mooted

Calling for setting up of MFIs across different parts of the country for credit disbursement besides creation of jobs in the un-banked rural hinterlands, Assocham said this would not only bring down rural poverty levels but also lesson the pressure on food subsidies.

Stating that the proposal would be shortly forwarded to the finance ministry as also Prime Minister office, Assocham President Swati Piramal said according to chamber estimates total requirement of micro credit in different locations of rural India is around Rs 50,000 crore.

Access to credit

In this regard, she said, the proposed MFIs would be ideal way to enable rural folks including its entrepreneurs to start off their own ventures, thereby bringing out the rural populace out of poverty net.

Stressing the need to provide better access to credit through micro finance institutions at nominal interest rates, she said, financial services extended to rural poor through MFIs can leverage their initiatives and accelerate process of building incomes and assets for them ensuring economic security. This would not only ensure financial inclusion but also bring rural populace into inclusive growth net.  Further, Pirmal pointed out that the Centre should encourage MFIs to form self-help groups and finance micro enterprises in unbanked/identified excluded rural/semiurban areas at reasonable rates. These MFIs, she noted, in course of time could also broaden their resource base through mobilising savings, accessing capital markets, loan funds and effective institutional development support.