An Overview On Performance Of Microfinance Institutions In India Before Covid 19 Pandemic

In a nation like India, where, according to World Bank reports, 60% of the population works in agriculture and 70% of the population lives in rural areas, microfinance can be extremely important in helping the underprivileged and low-income people access financial services. Microfinance is considered a valuable instrument for socio-economic improvement in a developing nation such as India. It is anticipated to have a major impact on development and the reduction of poverty. The performance and contribution of microfinance institutions to India's development are the main focus of this paper. from 2015–16 to 2016–17, the percentage of MFIs that obtained bank loans rose from 9.8% to 257.6%. The total amount of bank loans to MFIs fell 7.2% in 2016–17 compared to the year before. All of the following years saw an increase in the amount of loans owed to MFIs. In 2015–16 and 2016–17, it rose 13.7% and 14.3%, respectively. Furthermore, it is discovered that MFI business models in India are increasingly focused on urban areas, as evidenced by the fact that, with the exception of Assam, Arunachal Pradesh, Nagaland, Jammu & Kashmir, and Andaman, the percentage of rural clients in various states and union territories has decreased from 2016 to 2017. Andaman had the largest increase (267%), followed by Jammu & Kashmir (17%). During 2015, the percentage of income generation loans stayed constant, and in 2017, it rose to 94%.