The coronavirus second wave enforced lockdowns and restrictions will not impact microfinance institutions (MFIs) significantly, according to Udaya Kumar, MD & CEO of CreditAccess Grameen.
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The provisions remain elevated for CreditAccess Grameen Q4 earnings while write-offs aided non-performing asset (NPAs) this quarter.
“The temporary lockdown should not impact the microfinance drastically. Last year it was about 6 months; the first lockdown then intermittent lockdown then the moratorium. We got 6 months’ time to manage the business and we were able to come back to normalcy in 6 months’ time with 94-95 percent collections, which we precipitated we will get more than 6 months’ time this financial year and we would do much better than the last year,” Kumar told CNBC-TV18.
“We have a great experience of last year and by navigating the situation we did much better and similarly customers showed the resilience and came back to normalcy. Therefore, we believe that the situation should be better by Q2-Q3 (FY22),” said Kumar.
For the entire management interview, watch the video