The committee formed to address the problems of microfinance financial institutions by the Nepal Rastra Bank has found that a single individual has taken a loan of 52 lakh rupees from various microfinance institutions. The committee’s study report made public shows that the same borrower has a loan flow of 52 lakh, 17 thousand, and 834 rupees from 17 microfinance institutions to 22 loan accounts.
Not only that, the report also mentions that one borrower has taken loans from as many as 23 microfinance financial institutions. Similarly, the report mentions that 4 lakh, 18 thousand, and 722 borrowers have taken loans from two or more microfinance financial institutions.
One committee member has mentioned that there is a tendency for many microfinance institutions to lend more loans to a single borrower, which fulfills the target of weak laws and employees related to loan flow. And this is the reason why there is a risk of a large loan in microfinance.
According to the committee’s report, 11.7 percent of the total borrowers from microfinance have taken loans from two institutions, 5.6 percent from three to five institutions, 0.8 percent from 6 to 10 institutions, and 0.1 percent from more than 10 institutions.