Fitch Ratings said that due to the third wave of Corona, there is a possibility of decline in the asset quality of Non-Banking Financial Institutions (NBFIs). There may be delay in recovery of small amount of loan.
Possible delay in recovery of loans distributed to MSMEs.
Credit rating agency Fitch Ratings (said on Friday that due to increasing cases of Kovid-19 infection (Micro, Small and Medium Enterprises) and small amount loans may get delayed and increase the asset quality risk of Non-Banking Financial Institutions (NBFIs). Fitch estimates that India’s economic growth will be 8.4 percent in the current financial year ending March 2022. The rating agency also said that the asset quality of Indian NBFIs may deteriorate in 2022, mainly due to delays in lending to MSMEs and micro finance.
The Reserve Bank of India’s Financial Stability Report published in December 2021 also mentioned emerging signs of pressure in MSMEs as well as microfinance. The rating agency said such borrowers generally operate on limited cash buffers and capital, and have been hit hard during the pandemic. Fitch said that due to the outbreak of Omicron form in India, there may be delay in recovery of micro, small and medium enterprises and microfinance loans.
2.64 lakh new cases have been reported in 24 hours
According to the data released by the Union Health Ministry on Friday, there have been 2,64,202 new cases of corona virus infection in the country in the last 24 hours, which is the highest in 239 days. With the arrival of these new cases, the number of infected has increased to 3,65,82,129. This includes 5,753 cases of the Omicron form of this deadly virus.
United Nation also lowered growth forecast
Here the United Nations said on Thursday that in the current financial year, India’s economic growth rate will be 6.5 percent. A year ago, the growth rate was estimated at 8.4 percent. According to the World Economic Situation and Prospects (WESP) report released by the United Nations, India is on a ‘solid path’ of growth by undertaking rapid vaccination campaigns during the Kovid-19 pandemic. But the shortage of coal and high oil prices may halt economic activities in the coming times. This report says that India’s Gross Domestic Product (GDP) is estimated to be 6.5 percent in the year 2021-22, which shows a decline compared to the year 2020-21. This report estimates India’s growth to fall further to 5.9 per cent in the coming fiscal year 2022-23.
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