Rs.1,260 mn to write off micro finance debt trapped | Daily News


Rs.1,260 mn to write off micro finance debt trapped

The government will allocate Rs 1,260 million to banks and micro finance institutions to ease the people from debt trap. These monies allocated by the Treasury will be utilised for easing those affected after obtaining loans at high interest rates especially from micro finance institutions.

Accordingly the loans up to Rs 100,000 obtained for high interest rates will be written off. To write off these loans, the treasury will pay money to banks and 37 micro finance institutions in six instalments within a three year period, Deputy Treasury Secretary A.M.P.M.B. Atapattu said.

Of the six instalments, the first instalment of Rs. 200 million was paid at a ceremony held in Jaffna under the patronage of Prime Minister Ranil Wickremesinghe recently. It has been planned to pay the second instalment of Rs. 200 million to the banks and those micro finance institutions by next month by the Treasury.

People in rural areas are commonly affected by obtaining loans less than Rs.100,000 from micro finance institutions with huge interest rates. Considering this situation, the Government implemented this programme aiming to free affected people from loan trap last year.

According to Atapattu these people, who obtained loans were badly affected by the drought situation experienced in most parts of the country including the North, East, North Central, North Western provinces. 

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