The Indian government on Tuesday approved a a proposal to draw a loan of US$100 million (about Rs 450 crore) from the World Bank to promote microfinance in the country. The Cabinet Committee on Economic Affairs (CCEA) cleared the proposal for on-lending to the Small Industries Development Bank of India (SIDBI), which in turn would disburse the funds to the microfinance sector.
* "The fund will be used to promote responsible and balanced growth of microfinance outreach, particularly in under-served areas where micro finance penetration is low, thereby serving the larger objective of promoting financial inclusion," Home Minister P Chidambaram told reporters after the CCEA meeting.
* The decision is expected to help broad-base credit disbursals.