The Reserve Bank of India has increased the household income parameters for borrowers of Non-banking Financial Companies and microfinance institutions.
India’s Central Bank RBI (Reserve Bank Of India) on 9th November increased the household income parameters for borrowers of Non-Banking Financial Companies (NBFCs) and microfinance institutions (MFIs).
The income limit increased to Rs 1.25 from Rs 1 lakh. The decision taken to strengthen credit to those at the bottom of the economic pyramid in rural zones.
Likewise, the limit has been increased to Rs 2 lakh from Rs 1.6 lakh for urban or semi-urban zones.
What Made RBI Increase The Limit?
The limit has been increased after considering the role played by microfinance institutions in delivering credit to those at the bottom of the economic pyramid, the bank said.
It would also help enable microfinance institutions to play their assigned role in a growing Economy, it added.