Investment in Micro Finance Institutions by PSUS
Ministry of Finance, Department of Financial Services created India Micro finance Equity Fund (IMEF) with initial corpus of Rs.100 crore with Small Industries Development Bank of India (SIDBI) focusing on smaller socially oriented Micro Finance Institutions (MFIs) with the objective of poverty alleviation and achieving long term sustainability of operations in un-served and under-served parts of the country. Giving this information in written reply to a question (on whether the Government has any proposal for Public Sector Undertakings to invest in private Micro Finance Institutions) in the Lok Sabha today, Shri Praful Patel, Minister for Heavy Industries and Public Enterprises, said that the fund is utilized for extending equity, quasi equity or subordinated debt to Tier II (between 50,000 to 2,50,000 borrowers) and Tier III (less than 50,000 borrowers) MFIs. Government announced inter-alia allocation of Rs.100 crore to the IME Fund in the Budget 2013-14 and to provide another sum of Rs.100 crore to the fund enhancing the fund corpus to Rs.300 crore. As on date, SIDBI has sanctioned Rs.104.25 crore and disbursed Rs.79.25 crore. Further Rs.100 crore has been disbursed to SIDBI for 2013-14.
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KKP