The Bank is expecting a modest pick-up in productivity growth over the period ahead from the low rates of recent years, as well as a slight moderation in wage growth. Together, these developments would help lessen cost pressures in the economy and thus see some slowing in the rate of non-tradables inflation.
Such eligibility is linked to core features of microfinance, such as, lending of small amounts to borrowers belonging to low income groups, without collaterals, with flexible repayment schedules and with particular emphasis on measures to curb over-indebtedness. Margin caps and interest rate caps have also been stipulated to ensure protection of borrowers.