The microfinance industry is still uncertain about its future in India as it along with apex bank, RBI await the recommendations of the Malegam committee which has been set for the same.

MFIs are facing deep trouble owing to rising NPAs and poor recovery and are thus demanding capital infusion from the apex bank to enable them to wade through tough times.

All the 44 MFIs in the country have asked RBI as well as public sector banks to set up Rs 1000 crore corpus to aid them.

"No decision has been taken on the issue... PSBs are lending to the MFIs, there is no need for any additional fund," an official said on condition of anonymity.

There is no bar on lending to MFIs, we are lending to them on a case-to-case basis depending on the financials.," said chairman and managing director, Indian Bank, TM Bhasin.

"Our demand is still under consideration and no decision has yet been taken," MFIN president, Vijay Mahajan said.

All-India Bank Employees' Association (AIBEA) has however opposed the demand. "RBI should not accept it ... Banks should not give loans to MFIs under priority sector category," said AIBEA general secretary, C.H. Venkatachalam. "PSBs should (instead) go for large-scale micro lending through more number of rural branches."