The Asian Development Bank (ADB), a multilateral finance institution that is based in Manila, recently reported that it will not back microfinance institutions (MFIs) in the Indian state of Andhra Pradesh as part of its risk participation program.
Search Results for: pradesh
MICROCAPITAL BRIEF: India’s Andhra Pradesh State to Tighten Local Microfinance Institutions (Regulation of Moneylending) Act
The government of the Indian State of Andhra Pradesh reportedly is set to alter the Andhra Pradesh Microfinance Institutions (Regulation of Moneylending) Act, which was enacted December 2010 in response to complaints of high interest rates and coercive loan recovery, by replacing the term “self-help group (SHG) women” with “below poverty line (BPL) households” [1] [2]. According to unspecified sources at the Andhra Pradesh Chief Minister’s Office, the purpose of the replacement is “to ensure that MFIs adhere to the existing stringent rules” by “bringing all kinds of MFI loan products, existing and future, under the purview of the Act [1].”
MICROCAPITAL BRIEF: As Commercial Banks Remain Wary, Indian Microfinance Institutions (MFIs) Look Beyond Andhra Pradesh for New Markets
Following the promulgation of the Andhra Pradesh Micro Finance (Regulation of Money Lending) Act, which includes provisions intended to curtail coercive collections practices by microfinance institutions (MFIs) and their agents, many MFIs are considering cutting back their operations in Andhra Pradesh in favor of seeking expansion in other prospective markets [1].
MICROCAPITAL BRIEF: Reserve Bank of India (RBI) Proposal A Positive Step, Argues Tripathi… But Andhra Pradesh Government Oversteps
Salil Tripathi, director of policy at the British nonprofit Institute for Human Rights and Business, argues through the “Poverty matters blog” on the website of the UK’s Guardian newspaper that, while recent Reserve Bank of India (RBI) regulation is a positive step for the future of microfinance, the legislation passed by the state government of Andhra Pradesh reflects a monopolistic tendency. Mr Tripathi states that the move by local officials favors its own lending activities through self-help groups (SHGs) while it restricts the role of the private sector. On the other hand, he argues that the regulation suggested by RBI, while reducing choice and access to finance for the poor to a certain extent, is actually intended to protect the interests of the poorest [1].
MICROCAPITAL BRIEF: MicroSave’s India Focus Notes Examines Microfinance Turmoil in Andhra Pradesh
MicroSave, a private consulting company that provides technical assistance to microfinance institutions (MFIs), recently published a series of papers that examine the trouble that has arisen in microfinance in the Indian state of Andhra Pradesh since late 2010.
MICROCAPITAL BRIEF: Government of India’s Andhra Pradesh Considers Requiring Microfinance Institutions (MFIs) to Compensate Families of Suicide Victims
The government of the Indian state of Andhra Pradesh (AP) is considering a bill that would make it compulsory for microfinance institutions (MFIs) to compensate the families of borrowers who commit suicide as a result of heavy debt burdens.
MICROCAPITAL BRIEF: Participants at World Economic Forum Annual Meeting 2011 in Davos, Switzerland, Discuss Non-Payment in Andhra Pradesh, Consumer Protection, Microfinance Regulation
Participants of the World Economic Forum Annual Meeting 2011, which was held in Davos, Switzerland, from January 26 to January 30, discussed the future of financial services for poor people in a session called “Financial Inclusion: Beyond Microfinance.”
MICROCAPITAL BRIEF: Retail Microfinance Institution (MFI) Loans Taking Two Months to Process in Andhra Pradesh, India
Since the state government of Andhra Pradesh implemented a law in October 2010 that requires microfinance institutions (MFIs) to get approval from district officials before disbursing loans, it now reportedly takes approximately two months to process loans.
MICROCAPITAL BRIEF: Local Government in Indian State of Andhra Pradesh Considers Additional Microfinance Regulation, Requires Disclosure of Operational Procedures
The government of the Indian state of Andhra Pradesh, where the microfinance industry has been described as experiencing a crisis, is reportedly considering new legislation to refine an ordinance that was passed in October 2010 in response to a series of suicides said to be linked to debt collector harassment.
MICROCAPITAL BRIEF: Intellecap Publishes White Paper Analyzing Events Leading Up to Andhra Pradesh Microfinance Lending Crisis and State, Media Responses to the Crisis
Intellecap, a social-sector advisory firm with offices in India and the US, has released a white paper analyzing the events leading up to the ongoing microfinance lending crisis in Andhra Pradesh, a state on the southeastern coast of India.
MICROCAPITAL BRIEF: Microfinance Institutions (MFIs) in India’s West Bengal Face Cash Shortage as Pain Spreads Outside Andhra Pradesh
Microfinance Institutions (MFIs) in the Indian state of West Bengal are facing a shortage of lendable funds, as the banks from which they borrow reduce their exposure to the microfinance sector.
MICROCAPITAL BRIEF: Microfinance Information Exchange (MIX) Assesses Potential Impact of Recent Microfinance Regulation in India’s Andhra Pradesh State
Microfinance Information Exchange (MIX), a nonprofit that seeks to offer objective data and analysis on microfinance players, recently examined historical data from 2003 to the present from 100 MFIs in India to assess the hypothetical impact of capping interest rates at 24 percent and return on assets (ROA) at 3 percent, two limits effectively imposed by the state government on MFIs amidst the ongoing crisis in the microfinance industry in India’s Andhra Pradesh state.
MICROCAPITAL BRIEF: State-Owned Union Bank to Offer Microcredit in Indian State of Andhra Pradesh
The Union Bank of India (UBI), a state-owned bank based in Mumbai, has launched a new microfinance scheme to support self-help groups (SHGs), village-based financial intermediaries comprised of groups of 10 to 20 women, in Andhra Pradesh.
MICROCAPITAL BRIEF: Under Pressure from State Government of Andhra Pradesh, Indian Microfinance Institutions Agree to Cap Interest Rates at 24%
Several major microfinance institutions (MFIs) in the Indian state of Andhra Pradesh have agreed to cap interest rates at 24 percent per year after a series of politically-triggered freezes on bank lending to MFIs that followed an uproar regarding debt collector harassment that was linked to a number borrower suicides.
MICROCAPITAL BRIEF: India’s Microfinance Industry on Brink of “Collapse” Due to Credit Freeze in State of Andhra Pradesh
India’s microfinance industry is reportedly on the verge of “collapsing,” according to the UK’s Financial Times newspaper, due to politically-triggered bank freezes on credit in the state of Andhra Pradesh, where outstanding loans reportedly measure USD 2.7 billion distributed to 6.7 million borrowers.
MICROCAPITAL BRIEF: Payment Strike Hits India’s Andhra Pradesh State As Local Governments Urge Microfinance Borrowers Not to Repay
In India’s Andhra Pradesh state, local government officials are reportedly telling microfinance borrowers to stop repaying lenders even if they have the money to do so. The state government there has begun to increase restrictions on interest rates and arrest thuggish lending agents for fear that high rates and harassment from lenders has contributed to an overwhelming debt burden on microborrowers and suicides in the region.
MICROCAPITAL BRIEF: Experts Warn that New Legislation in Andhra Pradesh Might Reduce Profitability of Indian Microfinance Institutions (MFIs)
On the website of the LiveMint newspaper, a number of experts in India recently cautioned that legislations currently proposed in Andhra Pradesh, India, might cause a sharp drop in profitability of microfinance institutions (MFIs).
MICROCAPITAL BRIEF: SKS Microfinance Lowers Interest Rates in Andhra Pradesh to 24.55%
SKS Microfinance, a publicly traded microfinance institution (MFI) based in India, recently announced that it will lower interest rates to for new borrowers borrowers in the state of Andhra Pradesh from 26.69 percent to 24.55 percent.