Which of the following statements is/are correct?begin{enumerate}item At present Micro Finance Institutions (MFls) obtain finance from banks according to RBI guidelines.item MFIs provide small scale credit to low income households and small informal businesses.end{enumerate} Select the correct option from the codes given below:

BANKING GENERAL KNOWLEDGE

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

Which of the following statements is/are correct?

A	obtain finance from banks according to RBI guidelines.
B	Only 1
C	Only 2
D	Both 1 and 2
E	Neither 1 nor 2

Explanation:

Detailed explanation-1: -Definition of Microfinance Loan. 3.1 A microfinance loan is defined as a collateral-free loan given to a household having annual household income up to ₹3, 00, 000. For this purpose, the household shall mean an individual family unit, i.e., husband, wife and their unmarried children.

Detailed explanation-2: -They have to get NBFC License with RBI and fulfill the conditions as laid down for them. NBFC MFI is a non-deposit taking NBFC (other than a company licensed u/s 25 of the Indian Companies Act, 1956) that meets the following conditions: Minimum Net Owned Funds (NOF) of Rs. 5 crore.

There is 1 question to complete.