Ujjivan Small Finance Bank (Ujjivan) has announced a reduction in interest rates for microfinance and individual loans, reinforcing its commitment to financial inclusion. By offering one of the most competitive rates in the sector, the bank aims to make credit more affordable and accessible for underserved communities across India.
The move comes as the microfinance industry undergoes a major shift following new regulations by the Microfinance Institutions Network (MFIN). Effective July 2024, these regulations limit the number of lenders per borrower to four, with a further reduction to three from April 2025. In response, Ujjivan has realigned its lending and collection practices to ensure responsible credit access and prevent over-indebtedness. The bank’s proactive rate cuts reflect its commitment to empowering low-income households and micro-entrepreneurs through affordable financial products.
Siliguri, a rapidly growing commercial hub in North Bengal, is a key market for Ujjivan’s microfinance business. With a thriving base of small businesses and micro-entrepreneurs, the city presents significant growth potential. Ujjivan’s reduced interest rates are expected to enhance credit access for local enterprises, supporting business expansion and contributing to the region’s economic development. As India’s economic structure evolves from a pyramid to a diamond shape, with a growing middle-income segment, Ujjivan’s focus on affordable and responsible lending positions it as a vital player in the nation’s financial ecosystem.
