Question

    What is the limit of annual household income for a

    collateral free loanto be considered as a microfinance loan?
    A ₹1 lakh Correct Answer Incorrect Answer
    B ₹2 lakh Correct Answer Incorrect Answer
    C ₹3 lakh Correct Answer Incorrect Answer
    D ₹5 lakh Correct Answer Incorrect Answer
    E ₹7.5 lakh Correct Answer Incorrect Answer

    Solution

    A loan is considered as microfinance loans when it is: • a collateral-free loan, irrespective of end use and mode of application/ processing/ disbursal (either through physical or digital channels), provided to low-income households, i.e., households having annual income up to ₹3,00,000.  • For this purpose, the household shall mean an individual family unit, i.e., husband, wife and their unmarried children. • To ensure collateral-free nature of the microfinance loan, the loan shall not be linked with a lien on the deposit account of the borrower.

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