India’s institutional framework to support microfinance would get a boost with Reserve Bank of India clearing a proposal to dig in an existing Rs 1000-crore corpus for funding microlenders. Small Industries Development Bank of India (SIDBI) had kept this money for some other purposes and had recently sought RBI’s approval for using it for the microfinance sector.
The development bank will now use the money to offer soft loans to MFIs on a condition that end borrowers should get loans at 15-17% rate, which is significantly lower than the prevailing 20-22% market rate.
Source- The Economic Times
Static/Current Takeaways Important For IBPS Clerk Mains Exam 2018:
- Mohammad Mustafa is the present CMD of SIDBI.
- SIDBI Headquarters in Lucknow.
- SIDBI was set up on 2nd April 1990 under an Act of Indian Parliament.