Negative impactSector
CGSMFI 2.0 utilisation likely at Rs 8000-9,000 crore of Rs 20,000 crore pool; MFI SRO had sought extension
Economic Times 2 hrs ago·20 Sept 2026, 5:10 pm
The Credit Guarantee Scheme for Microfinance Institutions (CGSMFI) 2.0, a Rs 20,000 crore fund, is expected to be used only about Rs 8,000‑9,000 crore so far. Utilisation has been slower than anticipated even after the borrowing ceiling for larger MFIs was raised and the scheme’s expiry date was extended.
For investors, the modest uptake signals that many smaller micro‑finance lenders are still struggling to access affordable capital, which could limit the growth of loan portfolios in the segment. Banks and NBFCs that partner with MFIs may see slower credit expansion, affecting earnings linked to micro‑finance lending.
Market participants will be watching for any further policy adjustments, such as additional extensions or changes to eligibility, and for actual disbursement data in the coming months. A rise in utilisation would suggest easing funding constraints, while continued low uptake could keep pressure on the sector’s profitability.
Excerpt from Economic Times
Published On Sep 20, 2026 at 10:40 PM IST The utilisation of the government’s Credit Guarantee Scheme for Microfinance Institutions 2.0 ( CGSMFI 2.0 ) is estimated to have remained at around Rs 8,000-9,000 crore against the Rs 20,000 crore pool, according to three MFI lenders and self-regulatory organisation ETBFSI…Read the original at Economic Times
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