The Hindu Business Line : Women have better track record in repaying loans: Chidambaram

WOMEN SCORE IN REPAYING LOANS: The Union Finance Minister, Mr P. Chidambaram, and the Chairperson of the BIZWOMEN - 2005 conference, Ms Pallavi Jha, in Bangalore on Saturday. — G.R.N. Somashekar

Bangalore , Aug. 6

THE Union Finance Minister, Mr P. Chidambaram, on Saturday asked banks to alter conventional perceptions of women in credit appraisal.

Inaugurating BIZWOMEN-2005, a two-day conference on growing women's business to new heights, here, Mr Chidambaram said that credit risks for women in reality were very low compared to male borrower.

Besides, he added, that self-help groups (SHGs) had the best track record in ensuring repayments. SHGs have a repayment rate of 98 per cent of bank borrowings. This, he said, was far better than any other institutionalised borrowing. He added that this year saw a 200 per cent growth in SHGs functioning across the country.

At present, there were about 16.18 lakh SHGs in the country. Instead of merely showing lip sympathy, the banks should come out with better action on extending loans to women entrepreneurs, he added.

For bank credit to women, Mr Chidambaram said there was a huge gap between desirable credit offtake by women entrepreneurs and what was found on the ground. Banks, he said, should draw from the experience in rural areas in sanctioning and disbursal of credit to women.

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