- With the proportion of non-performing assets (NPAs) in bank loans given to self-help groups (SHGs) seeing a steady rise in the previous financial year,
- the Union Ministry of Rural Development has asked states to “monitor the status of NPA district-wise” and
- Take “corrective measures” to “recover overdue/ outstanding dues”.
- In some states, NPAs make up more than a quarter of the loans taken by SHGs, with Uttar Pradesh seeing a 15% jump.
- The ministry asked state officials to take action during a Performance Review Committee meeting held recently.
- The issue of NPAs in bank loans to SHGs was one of the important items on the agenda of the meeting, which reviewed the Deendayal Antyodaya Yojana-National Rural Livelihoods Mission, under which the government provides support to SHGs, including bank linkages.
- The State Rural Livelihood Missions (SRLMs) were told to “work out the amount to be deposited with banks before Sept 20 to avoid the account becoming irregular/ NPA”.
- Uttar Pradesh, which has 71,907 SHGs, reported that 36.02% of the loans taken by the groups were NPAs at the end of March 2020, from 22.16% at the beginning of last financial year.
- UP was followed by Punjab, which had an NPA share of 19.25%, Uttarakhand (18.32%) and Haryana (10.18%).
- In Arunachal Pradesh, the NPA proportion stood at an alarming 43%, though the number of SHGs there is just 209.
