Guwahati, Oct 16: Assam chief minister Himanta Biswa Sarma on Monday appealed to the womenfolk of the state to desist from taking loans from microfinance institutions.
“The interest rate (24 percent) charged by microfinance institutions is impractically high. As such, it is nearly impossible for the borrowers to repay their loans. Hence, I appeal to you to desist from taking any more loans from microfinance institutions,” Sarma said during the ceremonial distribution of relief under “Category – III” of the Assam Microfinance Incentive and Relief Scheme (AMFIRS) 2021 for beneficiaries of Dibrugarh district.
Dibrugarh district has a total of 22,172 beneficiaries under the Category – III relief of AMFIRS 2021.
Borrowers whose accounts had turned non-performing assets (NPA) as on March 31, 2021 and had outstanding principal amount of up to Rs 25,000 are deemed to be eligible for benefits under Category – III of AMFIRS 2021.
Notably, the Assam government is shelling out Rs 291 crore as compensation to the lenders (microfinance institutions) and the move is expected to benefit around 2.2 lakh borrowers from across the state.
In return, the concerned microfinance institutions shall issue “no dues certificate” to the borrowers, thus making the latter credit-worthy again under the formal financial system.
Speaking at the event, the chief minister said that he was happy that as many as 2.2 lakh female microfinance and bank loan borrowers have again become credit-worthy after being conferred with the “no dues certificates” by the lender institutions.
Sarma further said the main objective behind the launch of AMFIRS 2021 was to provide relief to borrowers who had availed small loans from microfinance institutions and the formal banking system but owing to certain circumstances, the borrowed amount could not be repaid either partially or fully.