“A Study on Loan Repayment Behaviour of Borrowers and its Determinants”

Dr. Shyam Sundar Itekala, Prof. Radha Krishna Murthy Gollapudi

Abstract


Microfinance is one of the basic and most important strategies for paucity of poverty in developing countries. Manny countries have realized this and started financing the people for their upliftment in many ways. The impact of microcredit is a subject of much controversy. Proponents state that it reduces poverty through higher employment and higher incomes. This is expected to lead to improved nutrition and improved education of the borrowers' children. Some argue that microcredit empowers women. However, increasing non-performing loan (bad debt loans) was a reason for provision and other administrative charges and on the other hand drastically reduces the banks income and profitability due to suspension of interest on non- performing loan. This undesirable fact tarnishes the image of the bank and negatively contributes to play its part in the countries development endeavors. Besides, ties the bank’s capital, affects its liquidity position, and reduces its competitiveness locally or in the global market and hence not compatible with a development bank that is expected to play an active and indispensable role by maintaining its sustainability. The current research paper focused on loan repayment behaviour of borrowers and its determinants in the view of loan delinquencies

Key Words: Micro Finance, Loan Delinquencies, Paucity of Poverty, etc.


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ISSN : 2251-1547