Demonetisation’s blow to microfinance sector
Demonetisation has adversely affected the growth in clients, loans disbursed and repayment rates
How has the demonetisation of November 2016 affected the cash-driven microfinance sector? Anecdotal evidence and media reports from different parts of the country in the first few months following demonetisation indicated considerable problems with loan disbursement and repayment. However, as we near the first anniversary of the withdrawal of specified bank notes, evidence of the impact on the hitherto growing microfinance sector demands attention.