IDFC First Bank receives ₹514.82 crore from CGFMU for MFI portfolio
IDFC First Bank received ₹514.82 crore from the CGFMU scheme for its microfinance portfolio. The payout covers eligible loans sanctioned up to March 2025. This amount is expected to be a write-back of previously made provisions for MFI defaults.
The amount received is substantial and will positively impact the bank's provisions and profitability, though it is a write-back of previously recognized losses rather than new income.
The receipt of a significant claim amount of ₹514.82 crore from the CGFMU scheme is a positive financial event for the bank, representing a write-back of provisions.
IDFC First Bank Limited has announced the receipt of ₹514.82 crore towards a claim related to its microfinance (MFI) portfolio under the Credit Guarantee Fund for Micro Units (CGFMU) Scheme.
MFI loans are provided to women entrepreneurs under a Joint Liability Group structure. The received payout is for eligible MFI loans sanctioned up to March 2025 and covers approximately 100% of the claim submitted by the bank.
The bank had previously made provisions for these MFI defaults, and consequently, this amount is anticipated to be a write-back of those earlier provisions. It is noteworthy that approximately 97% of all new microfinance loan originations from January 2024 onwards are covered by the bank under the CGFMU Scheme.
This information is being uploaded to the bank's website in accordance with the SEBI Listing Regulations.
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