On Friday, Union Minister Nitin Gadkari said that the government is planning to create a deposit-taking 'social microfinance organisation' to disburse loans of up to Rs 10 lakh to women and small entrepreneurs quickly.
The Minister for MSME and Road Transport and Highways said that the idea for microlending body came up during a discussion with Nobel laureate and Grameen Bank founder Mohammed Yunus of Bangladesh, and will be confirmed after discussions with the Finance Ministry.
India already has dedicated micro-lenders serving in various parts of the country and some of them have already graduated to work as small finance banks, which gives them access to deposits. It can be noted that deposit acceptance is treaded with a lot of caution by policymakers.
Speaking at an interaction with Ficci FLO, Gadkari said the government is mulling over the idea where the finance of up to Rs 10 lakh can be availed by women entrepreneurs within three days.
Explaining the procedure for such a system, the minister said, "You (the financing entity) can register and you will get a license from RBI and you can accept deposits and giving loans to the small people. This type of mechanism we are developing for social micro & small institutions with a very simple procedure, without red tapism".