The RBI's warning on bad loans comes at a time country's financial system in reeling under stressNew Delhi:The Reserve Bank of India (RBI) has raised a red flag on spike in non-performing assets (NPAs) under Pradhan Mantri Mudra Yojana, government's flagship scheme to support micro enterprises in country.According to Finance Ministry sources, RBI has cautioned ministry that scheme might turn out to be next big source of NPAs, which have plagued banking system.The central bank has said that bad loans under Pradhan Mantri Mudra scheme have risen to Rs 11,000 crore.
( From PM Modi, 6 pre-election perks including GST help for small businesses)As per annual report of Mudra scheme, total disbursements under scheme stood at Rs 2.46 lakh crore in 2017-18.Out of this, 40 per cent were disbursed to women entrepreneurs and 33 per cent to social categories.
More than 4.81 crore micro borrowers have benefited through PMMY scheme during year FY18.The Mudra scheme was launched on April 8, 2015.
Under scheme, banks are required to finance micro and small entrepreneurs for up to Rs 10 lakh.
Loans can be granted under three categories: up to Rs 50,000 under 'Shishu' category; Rs 50,001-Rs 5 lakh under 'Kishore', and between Rs 5,00,001 and Rs 10 lakh under 'Tarun' category.In addition, RBI's caution comes at a time country's financial system in reeling under severestress due to ILFS crisis which continues to hurt banks with impairments.On January 9, IndusInd Bank in its latest quarterly earnings result statement, without naming ILFS Group, said: "Advances granted to various companies and SPVs belonging to a Group in infrastructure sector against certain identified cash flows and pertaining to specific assets are 'Standard' as at December 31, 2018 on basis of conduct of accounts till date.""Since October 1, 2018, certain governance and management changes have taken place in Group and measures to turn it around through a Resolution Plan are underway."The bank said it was monitoring developments and implications of resolution plan."In interim, as a prudential measure, bank has made a contingent provision of Rs 255 crore on these 'Standard' assets during quarter ended on December 31, 2018, in addition to an amount of Rs 275 crore made during quarter ended on September 30, 2018.
Total provisions attributable to this exposure is Rs 600 crore," statement added.