MFIs clamour for more bank loans

KOLKATA: Country's leading microfinance players including Bandhan, Basix and Ujjivan have requested banks to enhance the credit flow to them as they have streamlined their operation following Reserve Bank of India guidelines.

These microfinance institutions or MFIs under the banner of their umbrella organisation MFIN held a meeting with bank officials on Wednesday and sensitised bankers on their improved activity.

""Although a few banks have opened the loan tap, most MFIs have not been able to get funding. Small and medium sized ones face difficulties in getting bank loans,"" Ujjivan Financial Services chief executive Samit Ghosh told ET over telephone after the meeting in Mumbai.

State Bank of India and Small Industries Development Bank of India officials were present at the meeting. The private sector was represented by HDFC Bank, RBS, IndusInd Bank, Kotak Mahindra Bank, an MFI official said.

""Private sector banks need to step up the size of their priority sector advances and lending to MFIs is an easy way out for them at this juncture. That's perhaps why they have all come in droves to attend the meeting,"" a senior official with a public sector bank said.