Search
Bandhan Bank to halve its microfinance portfolio
May 16, 2022
“As a strategy need to reach the people who don’t have credit access. So, we are attempting to focus on retail and arrive at the areas where not few banks have a presence” said Chandrashekhar Ghosh, MD, Bandhan Bank. “We are seeing bringing down the share of the microfinance portfolio”.
Fundamentally, microfinance advances which are ordinarily estimated higher than famous benchmarks compared with credits reached out to different sections like housing and MSMEs, endured a shot during the pandemic as collection efficiency dipped resulting in a deterioration in asset quality of such loans at the business level too. 47% of Bandhan’s credit portfolio is in microfinance. Yet, Bandhan’s collection efficiency improved to 99 percent in the March’22 quarter from 80% in the June’21 quarter according to senior officials.
The conscious reduction in focus on microfinance doesn’t imply that they are going delayed on microfinance, the bank officials clarified. At present, retail barring housing represents under 2% of the bank’s credit portfolio and it is here where the thrust is going to increase. While housing and MSMEs represent 27 and 28 percent respectively of their loan portfolios.
Important Links:
- 4-IN-1 Professional Diploma in Banking, Financial Services & Insurance (PDBFSI): https://ask.careers/courses/4-in-1-professional-diploma-in-banking-financial-services-insurance-pdbfsi/
- Mumbai: https://ask.careers/cities/mumbai/
- TSCFM: https://ask.careers/institutes/tscfm/