Microfinance institutions expect pent-up credit demand to spur disbursement as the lockdown gradually eases and operations that have come to a halt rebooted.

The industry has welcomed the twin benefits of being included in the list of permitted activities that will be allowed from Monday, in a revised circular of the home ministry, and the RBI’s liquidity enhancing measures.

“People will need capital to start their livelihood again. So, credit demand will substantially rise. It is important that we have adequate liquidity,” said Manoj Nambiar, managing director of Arohan Financial Services.

“It is good that the RBI has specified that 50 per cent of the TLTRO have to be deployed for small NBFCs and MFIs. Once the lockdown is lifted, and normal operations start, there would be a need to cater to the demand for informal and unorganised sector borrowers,” said P. Satish, executive director, Sa Dhan.