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Growing NPA in SHGs

NABARD has expressed its concern over the growing NPA in SHGs in the recent years, in the 2011-12 report of Status of SHGs in India. In absolute terms, the gross NPA against loans to SHGs increased from `1474 crore at the end of March 2011 to `2213 crore by March 2012.

In percentage terms it increased from 4.72% last year to 6.09% during the current year. It was only 2.9% during 2009-10. This is a matter of concern for the microFinance sector and the causes for the declining performance of recovery are to be analysed and remedial action initiated urgently. The total gross NPA against loans to SHGs stood at `2212.74 crore as on 31.3.2012 against the total outstanding loan of `36340 crore. Among the regions, southern region with a NPA of 4.98% (3.79% last year) was the lowest while Central Region with an alarming 13.2% (10.7% last year) was the highest. What causes grave concern is the high NPAs in major states like Uttar Pradesh (12.5%), Odissa (11.9%), Tamil Nadu (9.6%) and Kerala(9%).

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