india

Updated: Nov 26, 2018 07:21 IST

In a sign of better economic activities among grassroot-level rural women, loans taken by them under a government’s flagship programme has reached the lowest ever non-performing assets (NPAs). The lowest rate of bad loans has come amid higher loan amount.

The Centre’s flagship National Rural Livelihood Mission (NRLM) aims to help the rural poor to increase their household income and giving them better access to financial services.

The latest data available with the ministry shows that till March 2013, the NPA in women-run self-help groups (SHGs) was 7.08% against an outstanding loan amount of Rs 39.3 crore.

As on September 2018, the NPA reduced to 2.7% even as the outstanding loan amount has gone up to Rs 73,191 crore under the revamped Deendayal Antodaya Yojna (DAY NRLM).

Officials at the rural development ministry also point out that between 2000 and 2013, a total of ~1.04 lakh crore was lent to women-run self-help groups. But during the last 5½ years, banks have given ~1.88 lakh crores credit to these groups.

The NRLM is widely seen as a key to Prime Minister Narendra Modi’s plan to double the farmers’ income. The BJP-led government had repeatedly promised to double farmers’ income by 2022. It is also an issue of major political slugfest as Opposition leaders have often quoted data to show the farmers are not getting their remunerative prices for most of their products. They have also blamed demonetisation for ruining the farmers’ prospects.

The NRLM helps the women members of a family to create sources for additional income from alternative sources.

“In case of drought or flood affecting the farm income, the family can also fall back on income from these sources to smoothen their consumption, minimise shocks and vulnerabilities,” pointed out an official.

Rural development secretary Amarjeet Sinha claims that some key interventions like repositioning SHGs as a preferred vehicle for banks, setting standard protocols on identification of eligible SHGs and estimation of credit requirements and helping people to chose viable projects have led to these changes.

“The social capital has led to a diverse and robust economic activity,” added Sinha.

Abhirup Sarkar, professor of economics in Indian Statistical Institute said, “Decrease in NPA is an important aspect to judge the success of SHGs but it is certainly not the only aspect. This achievement is not entirely surprising because Bandhan Bank, that works only on minor credit has less than 1% NPA rate.”