In the Union Budget 2015/16,
Finance Minister Arun Jaitely has proposed to set up a Micro Units Development
and Refinance Agency (MUDRA) Bank to encourage entrepreneurship among SC/STs
and OBCs. The Mudra Bank will refinance institutions through a Pradhan Mantri
Mudra Yojana.
Capital Requirement: The MUDRA Bank will set up with the capital
of Rs. 20,000 crores and would be responsible
of regulating and refinancing all Micro – finance Institutions (MFI). A sum of
Rs. 3,000 crores would also be provided to Mudra Bank, to create Credit Guarantee
corpus for guaranteeing loans being provided to the micro enterprises.
Micro – Finance: The objective of the Micro Finance is to give
low income and poor people an opportunity to become self – sufficient by providing
financial services, saving money, borrowing money and insurance.
According to the data released in
2013 by National Sample Survey Organisation (NSSO), there are 5.77 crore small
business units in the country, which are mostly owned by people belonging to
Scheduled Caste, Scheduled Tribe or Other Backward Classes, which run small
manufacturing, trading or services activities. Only 4% of such units get
institutional finance.
The Mudra Bank would primarily be responsible
for –
1. To make policies and guidelines
for micro/small enterprise financing business
2. Registration and
regulations of MFI entities
3. Approval /rating of
MFI entities
4. To establish financing
practices to area off indebtedness.
5. To ensure proper
client protection principles and methods of recovery
6. To promote right
technology solutions for the last mile
7. To formulate and
implement a Credit Guarantee scheme for providing guarantees to the loans which
are being extended to micro enterprises
Also Read:
Small & Payment Banks to start off soon…
https://www.pagalguy.com/articles/small-payments-banks-to-start-off-soon-31691993