More MFIs adopt cash­less pro­cesses

Banking Frontiers - - News / Mfi -

More than 60% mi­cro­fi­nance in­sti­tu­tions in In­dia have gone cash­less for loan dis­bur­sals, ac­cord­ing to a re­port by Mi­cro­fi­nance In­sti­tu­tions Network (MFIN). The re­port said in fis­cal 2017, over 60% MFIs dis­bursed loans through cash­less means of which nearly 88% were through NEFT/IMPS. How­ever, in the fourth quar­ter of fis­cal 2017 which was the note ban pe­riod, only 39% dis­burse­ments were cash-lite trans­ac­tions, it added. The re­port said the rise in MFIs’ cash­less pay­ment mod­els are largely at­trib­uted to benefits of risk mit­i­ga­tion and in­creased op­er­a­tional ef­fi­ciency that in­cludes im­proved cash man­age­ment prac­tices, in­creased safety and staff pro­duc­tiv­ity. Ratna Vish­wanathan, CEO, MFIN, said de­mon­e­ti­za­tion and gov­ern­ment’s push to adopt digital trans­ac­tions have helped in MFIs’ tran­si­tion to cash­less modes. It has also helped in in­creas­ing aware­ness about non- cash trans­ac­tion meth­ods among the ben­e­fi­cia­ries even in ru­ral ar­eas, she added.

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