Page 95 - MUDRA ANUBHAV

guarantee, and hence they might be denied loans.
This stops the reach of the scheme to many of the
needy borrowers.

Margin money is own contribution of the
entrepreneur in the business. Financial institutions
insist on margin money as it ensures commitment
of fund from the borrower as well. It is a common

practice across many borrowing categories to insist
on margin money. It was shared by majority i.e.
58.60% of the respondents that their institution
insists upon margin money contribution (Figure

No. 30). While it is prudent from their side, but
every borrower may not be capable to margin
contribution and hence may not receive funding
if the financial institution insists upon the margin

contribution.

Growing NPA is not only the problem faced by
financial institutions but is a hindrance to economic
growth. If the banking and financial system of a

nation is not well rewarded and runs into losses, it
becomes a great challenge to meet the development
goals. To understand the challenges faced due to
NPA related to PMMY, respondents were asked to

share their experience as to whether they have
come across any willful defaulters. Sadly, majority
i.e. 69% reported having experienced willful default
by the borrowers.

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