With 61% of Loan Book Tied up in High-Risk Microcredit, Bandhan Bank Feels the Heat of Coronavirus Lockdown
By Dinesh Unnikrishnan
2010, when the microfinance crisis broke out in the southern state of Andhra Pradesh, banks with high exposure to Micro Finance Institutions (MFIs) witnessed a devastating phase.
The extent of the crisis prompted banks to shut lending channels to microfinance companies temporarily. Bad loans were zooming. One of the private lenders, Yes Bank, had to even recall some of its loans given to certain MFI customers.