The Indian Government has announced plans to allocate INR 200 billion (USD 319 million) for a new bank to be known as The Micro Units Development and Refinance Agency Bank (MUDRA). MUDRA will serve as a refinancing institution, with the intent of allowing easier access to credit for microenterprises, with a priority for funding loans to the quarter of Indians who are members of Scheduled Castes and Scheduled Tribes, which historically have lower incomes than other Indians. USD 48.2 million of the MUDRA budget is for credit guarantees to benefit the microenterprises. Arun Jaitley, India’s Minister of Finance, was quoted as saying, “Just as we are banking the unbanked, we are also funding the unfunded” [1].
By Jeff Pierce, Research Associate
Sources and Additional Resources:
[1] New Indian Express: “Government to Set Up Mudra Bank for Priority to SC/ST Entrepreneurs” by PTI, http://www.newindianexpress.com/budget-2015/Government-to-Set-Up-Mudra-Bank-for-Priority-to-SCST-Entrepreneurs/2015/02/28/article2691408.ece
MicroCapital, January 27, 2015, “India Completes Phase I of Jan-Dhan Initiative to Provide Banking Services to Every Household,” https://www.microcapital.org/microcapital-brief-india-completes-phase-i-of-jan-dhan-initiative-to-provide-banking-services-to-every-household/
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