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Time of India
2 days ago
- Business
- Time of India
RBI lowers qualifying asset criteria for NBFC-MFIs to 60% from 75%
The Reserve Bank of India ( RBI ) Friday lowered the minimum amount of eligible microfinance loans specialized lenders must hold on their books, allowing microfinance-NBFCs to further diversify their asset base. In a notification Friday, the central bank said qualifying assets (those meeting the definition of microfinance loans) of NBFC-MFIs must constitute a minimum of 60% of the total assets (netted off by intangible assets), on an ongoing basis. The earlier threshold was 75%. 'If an NBFC-MFI fails to maintain the qualifying assets as aforesaid for four consecutive quarters, it shall approach the Reserve Bank with a remediation plan for taking a view in the matter,' the RBI said. The central bank also said that 'qualifying assets' of NBFC-MFIs has been aligned with the definition of 'microfinance loans'. As per RBI rules, microfinance loan is defined as a collateral-free loan given to a household having annual household income up to Rs 3,00,000. 'This policy shift will enable accelerated diversification within our operations, ensuring balance sheet stability and positioning us for robust cross-cycle earnings,' said Ganesh Narayanan, Chief Executive Officer, CreditAccess Grameen Ltd . Reduction in the qualifying asset criteria for NBFC-MFIs is expected to improve loan diversification of lenders, thereby augmenting their credit risk profile . It will also enable them to meet other credit requirements of their end borrowers, according to A M Karthik, Senior Vice President & Co-Group Head, Financial Sector Ratings, ICRA .
The Hindu
2 days ago
- Business
- The Hindu
RBI reduces qualifying asset threshold for NBFC-MFIs
The Reserve Bank of India (RBI) on Friday reduced the qualifying asset threshold for non-banking financial companies – microfinance institutions (NBFC-MFIs) to 60% from 75%, in a boost to the industry. Qualifying assets of NBFC-MFIs shall constitute a minimum of 60% of the total assets (netted off by intangible assets), on an ongoing basis. If an NBFC-MFI fails to maintain the qualifying assets as per the threshold for four consecutive quarters, it shall approach the Reserve Bank with a remediation plan for taking a view in the matter, the RBI said in a notification. This will now help the microfinance sector to diversify and expand its assets and improve the financial position of the MFIs, JiJi Mammen, executive director and CEO of Sa-Dhan, a self-regulatory organisation for the microfinance industry, said. 'I am sure this will help the sector strengthen and provide better services to poor households. It is really great to see this decision on a day when the monetary policy committee has announced a significant reduction in repo rate and lowering of cash reserve ratio. These steps will help in improving fund availability to the MFIs,' he said. 'This policy shift will enable accelerated diversification within our operations, ensuring balance sheet stability and positioning us for robust cross-cycle earnings,' said Ganesh Narayanan, CEO, CreditAccess Grameen Ltd. It is a welcome step that will help NBFC-MFIs to comply with the requirement and give some scope for diversification. This decision empowers NBFC-MFIs with greater operational flexibility, enabling them to diversify their portfolio, serve a broader borrower base and structure loans with more adaptive terms, said Jugal Kataria, group controller, Satin Creditcare Network Ltd. 'By easing the norms and allowing flexibility for a temporary dip below the threshold for up to three consecutive quarters, the RBI has not only acknowledged ground realities but also ensured that NBFC-MFIs can maintain healthy liquidity, ' he said.
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Business Standard
16-05-2025
- Business
- Business Standard
CreditAccess Grameen Q4 results: Net profit down 88.1% at ₹47.2 crore
Microfinance lender CreditAccess Grameen Ltd reported an 88.1 per cent year-on-year (YoY) decline in net profit to ₹47.2 crore for the quarter ended March 2025 (Q4FY25), owing to conservative provisioning and accelerated write-offs. For the full financial year FY25, the company's net profit rose 63.2 per cent YoY to ₹531.4 crore. Its stock closed 0.9 per cent higher at ₹1,204.90 per share on the BSE. In a filing with the exchanges, the company said its net interest income (NII) declined 5.0 per cent to ₹876.1 crore in Q4FY25. Its net interest margin dropped to 12.7 per cent from 13.1 per cent in Q4FY24. The total write-off stood at ₹518.2 crore in Q4, including ₹479.2 crore in accelerated write-offs, resulting in an additional credit cost of ₹150.7 crore. Gross non-performing assets (NPAs) rose sharply to 4.76 per cent as of March 2025, up from 1.18 per cent a year ago. The microfinance lender's gross loan portfolio declined by 2.9 per cent YoY to ₹25,948 crore as of March 2025. Considering the evolving business environment, the company is targeting loan portfolio growth of 14–18 per cent in FY26. Of this, growth in the microfinance segment will be 8–12 per cent, with the remainder coming from retail finance, said Ganesh Narayanan, Chief Executive Officer of CreditAccess Grameen. Udaya Kumar Hebbar, Managing Director of the company, said the continued effort to address ground-level challenges, reduce customer leverage, and expand the on-ground workforce has significantly improved customer engagement. 'This has enabled more frequent and disciplined follow-ups on delinquent accounts, resulting in improved collections,' the company said in a statement.
Associated Press
24-02-2025
- Business
- Associated Press
Cyber Attacks on Manufacturers Up Globally, But Less Than Half Prepared in Security
Estimated downtime cost individual firms up to US$2M; traditional 'air gapping' no longer sufficient SINGAPORE, Feb. 24, 2025 /PRNewswire/ -- A global study by Omdia has found that 80% of manufacturing firms experienced a significant increase in overall security incidents or breaches last year, but only 45% are adequately prepared in their cyber security. Omdia surveyed over 500 technology executives worldwide on the convergence of Information Technology (IT) and Operational Technology (OT) – or physical systems – in their core operations, and how they managed cyber security challenges. The report for the study was produced in partnership with Telstra International, the global arm of leading telecommunications and technology company Telstra. The heightened risk of cyber attacks comes as manufacturers move to leverage IT such as cloud, AI, and Internet of Things (IoT) as part of their digital transformation – a process defined as Industry 4.0. While the convergence of IT with traditional OT can increase scale, resilience and efficiency in operations, it also increases the attack surface for cyber threats. Critical industries are increasingly lucrative targets for cyber exploitation including ransomware. Manufacturers affected by a cyber attack reported a resilience or availability issue that cost individual firms between US$200,000 and US$2 million, taking the biggest hit when incidents affected enterprise and corporate systems or production control. Geraldine Kor, Telstra International's Head of Global Enterprise Business, said: 'Greater connectivity between IT and OT is necessary to harness advanced technology for manufacturing innovation, but it increases the risks of a breach. However, very few firms are mature in protecting and defending against such cyber risks. 'Our study also uncovered a fragmented approach to security responsibility, which can leave manufacturing businesses without a clear direction. This responsibility must be clear and integrated so that one group or person will have the authority to act on security challenges for mission-critical systems. It is equally important to have the right people and security-focused culture as their absence will hinder security posture readiness, compounding technical challenges.' Ganesh Narayanan, Telstra International's Global Head of Cyber Security, noted that the manufacturing and other industrial sectors historically relied on air gapping for security, where OT systems are typically segregated from corporate IT systems to protect against external threats. However, this approach is no longer sustainable with increasing IT-OT convergence, which expands the threat surface significantly. He said: 'IT and OT integration create enormous value for organisations across industries, although organisations must address risks to unlock its potential. Organisations should prioritise IT/OT and IoT security across six core areas: Collaboration and planning, defining a strategy, bolstering technical expertise, assign responsibility and accountability, leveraging the right tools, and expedite readiness with standards.' Adam Etherington, Senior Principal Analyst at Omdia, said: 'Our study illuminates critical attack vectors and lessons learned, and provides timely advice for any executive responsible for IT and OT. 'More pervasive connectivity between IT and OT is essential across greenfield and brownfield manufacturing system design and enhancements. Step change improvements to innovation, availability, safety and security require firms to harness cloud, IoT, AI and private networks, with IT/OT convergence bringing these technologies to life. 'However, most firms have been hit with expensive outages and security incidents while traditional security controls, policies and culture struggle to keep pace. Given the magnitude of downtime costs from any breach or network incident that impacted operations, it's important to better understand the causes for proactive remediation.' Please see 'Notes to Editor' below for additional details of the study ##### About Telstra International Telstra is a leading telecommunications and technology company with a proudly Australian heritage and a longstanding, growing international business. Telstra International empowers enterprise, government, carrier, and OTT customers with innovative technology solutions. These services are underpinned by our wholly owned subsea cable network, which is the largest in Asia Pacific and includes more than 30 cable systems spanning over 400,000 km, with access to multiple cable landing stations and more than 2,000 points of presence around the world. For more information, please visit Notes to Editor Key findings 1. Industry 4.0 is the biggest factor driving IT-OT convergence 86% of respondents said connecting IT with OT was important or very important to achieve business outcomes, acknowledging the vital, complementary roles they play. Industry 4.0 was the top factor driving IT-OT convergence in the past two years, with 47% of respondents citing it alongside cyber security, and increasing resiliency and availability. 2. Increase in overall OT security incident with significant financial loss as impact Four in five, or 80% of respondents, indicated they saw a 'significant increase' in overall security incidents or breaches in the past 12 months, with manufacturing firms of different sizes impacted. Respondents were not asked to quantify the level of this increase. 62% of manufacturing firms experienced a resilience or availability issue, typically costing US$200,000 to US$2 million. This cost impact was common across regions. 3. Most attacks started in IT, not OT The study found Cyber-to-Physical security attacks, referring to IT attacks that impacted OT or operations, accounted for 75% of such incidents. Most attacks took place at the higher level of the IT/OT stack, namely the more advanced layers of the technology systems that are used to process or analyse data. Advanced persistent threats (APT), malware, and distributed denial of service (DDoS) were reported as the most prevalent attacks on OT systems. 4. Only a small percentage of manufacturing firms are 'advanced' in securing IT/OT Omdia used the NIST and ISA95 frameworks to assess the current maturity of organisations in securing IT/OT convergence. Only 45% of all manufacturers were very prepared for IT/OT converged security across important areas that include securing networking, security awareness, supply chain risks, and cultural issues. 42% were 'somewhat' prepared and 13% were not at all prepared, with no formal process in place. 5. Responsibility for OT security increasingly coming under IT's remit While historically engineering-led production managers were directly responsible for production and operations in manufacturing, this model is changing as IT-OT convergence gathers momentum. The study shows OT security responsibility is increasingly falling into the remit of Chief Information Security Officers (CISO), and other executives from an IT security background. One in five respondents said their CISO was responsible for understanding and implementing IT/OT converged security in their organisation. 6. More manufacturing companies are outsourcing their IT/OT security Respondents highlighted challenges in finding skilled and experienced staff who understand both IT and OT from a security perspective, especially in their industry context. As a result, most firms will engage a third party under an outsourcing agreement or with in-house teams to bolster IT/OT-specific security services. North American firms (51%) are most likely to outsource their IT/OT security in the next 18 months, followed by those in Asia Pacific (43%), Europe (37%) and Latin America (37%). About the Survey The Telstra International Global Manufacturing Security Services Market Study 2024 was carried out by Omdia in September 2024. 513 technology executives responsible for IT or OT security were surveyed 51% were Technology or Security Executives e.g. CIO 49% were Line of Business Directors Sectors Equipment and Other Discrete Manufacturing Automotive and Vehicle Manufacturing Industrial Process Manufacturing Construction Mineral and Metal Mining Agriculture Food and Other Consumer Products Manufacturing Organisation size 45% with 500-999 employees 55% with 1000+ employees Regions North America Latin America Europe APAC
