Indian microfinance institutions (MFIs), which have struggled to procure loans from commercial banks since turmoil struck the microfinance industry in Andhra Pradesh in November 2010, have found that raising money by securitizing even their higher-quality loan portfolios has become more expensive.
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MICROCAPITAL BRIEF: Suresh Gurumani, Director of India’s SKS Microfinance, Resigns
India’s SKS Microfinance, a microfinance institution (MFI) that loans to impoverished women in India, has reported that Suresh Gurumani has resigned from his post as director of the company’s board.
MICROCAPITAL BRIEF: India’s MicroSave Publishes “No Thrills: Dormancy in NFA Accounts,” by Ann-Byrd Platt, Akhilesh Singh, Sachin Bansal, Anurodh Giri, Akhand J Tiwari re “No Frill” Microfinance Accounts
MicroSave, an Indian for-profit technical assistance, training and resource center, recently published “No Thrills: Dormancy in NFA Accounts,” a study on India’s “No Frill Accounts (NFAs),” a basic account option legally required of private banks as part of Reserve Bank of India’s (RBI’s) “Financial Inclusion Programme.”
MICROCAPITAL BRIEF: BASIX Group of India Looks to Boost Fee-Based Income by Offering Commercial Banks Access to Its 3.5m Microfinance Customers
BASIX Group, an Indian company whose holdings include two microfinance institutions (MFIs), reportedly intends to rework its business plan to diversify away from direct microlending and generate more income from allowing commercial banks access to its 3.5 million customers.
MICROCAPITAL BRIEF: IFMR Capital Structures $3.8m Securitization of Microfinance Loans Originated by Ujjivan Financial Services of India
IFMR Capital, an affiliate of the India-based nonprofit Institute for Financial Management and Research (IFMR), recently completed a securitization of approximately 21,000 microloans originated by Ujjivan Financial Services, an India-based microfinance institution (MFI), that is valued at INR 173 million (USD 3.82 million).
MICROCAPITAL BRIEF: In Partnership with 15 Microfinance Institutions (MFIs), Dia Vikas Capital to Distribute Micro-Pension Scheme Initiated by India’s Pension Fund Regulatory and Development Authority (PFRDA)
In association with its 15 partner microfinance institutions (MFIs), Indian social venture firm Dia Vikas Capital, a subsidiary of nonprofit Opportunity International Australia, will distribute a micro-pension scheme that was initiated by the Pension Fund Regulatory and Development Authority (PFRDA) of the Indian government. The program, NPS-Lite, will encourage economically disadvantaged people to save money for when they are over age 60 [1]. The Indian government is reported to have committed to match NPS-Lite contributions up to INR 1,000 (USD 22) per client annually [1] [2].
MICROCAPITAL BRIEF: To Counter Liquidity Crunch in India, Grameen Koota, Bandhan, SKS Securitize Loans Disbursed to Women
Microfinance institutions (MFIs) in India are reportedly securitizing more of the loans they disburse to women in order to raise capital they would likely have borrowed from banks before the liquidity crunch that has affected the microfinance sector since late 2010.
MICROCAPITAL BRIEF: Supreme Court Schedules Hearing on Petition Filed by SKS Microfinance Against Over Regulation of Moneylending Act of India’s State of Andhra Pradesh
SKS Microfinance, an Indian microfinance institution (MFI), has filed a petition with the Supreme Court of India seeking a stay to prevent the enforcement of the Regulation of Microlending Act issued by the government of the Indian state of Andhra Pradesh.
MICROCAPITAL BRIEF: Details Emerge on “Microfinance Bank” Proposed by Government of Andhra Pradesh, Government of India, Several Banks
The government of India, the government of the state of Andhra Pradesh and a consortium of five unnamed private and public banks have submitted an application to the Reserve Bank of India (RBI), the country’s central banking authority, to establish a “microfinance bank” as an alternative to microfinance institutions (MFIs) in the state of Andhra Pradesh [1].
MICROCAPITAL BRIEF: Microfinance Information Exchange (MIX): Microfinance Institutions Will Face Difficulties Meeting New Reserve Bank of India (RBI) Regulations
Microfinance Information Exchange (MIX), the US-based, nonprofit data provider, foresees a significant impact on microfinance institutions (MFIs) in India as a result of the regulations that were recently issued by the Reserve Bank of India, the country’s central banking authority, in response to the turmoil that has disrupted the microfinance sector since late 2010, particularly in the state of Andhra Pradesh.
MICROCAPITAL BRIEF: Confusion Continues Over Regulation of Microfinance Institutions (MFIs) in India, State of Andhra Pradesh May Adjust Law to Reconcile With Federal Rules
The Business Standard, an Indian financial newspaper, recently reported that the regulations recently issued for the microfinance sector by the Reserve Bank of India (RBI), India’s central banking authority, and the Regulation of Microlending act issued by the government of the state of Andhra Pradesh in 2010 are creating confusion over the regulatory jurisdiction of each entity.
MICROCAPITAL BRIEF: Credit Rating and Information Services of India Limited (CRISIL) Predicts Reserve Bank of India Guidelines Will Spur Bank Lending to Microfinance Institutions (MFIs), Trigger Consolidation
The Indian rating agency Credit Rating and Information Services of India Limited (CRISIL) has announced that it expects, “Growth prospects for microfinance institutions (MFIs) will remain subdued over the medium term,” due to microfinance guidelines issued earlier this month by the Reserve Bank of India (RBI), the nation’s central banking authority.
MICROCAPITAL BRIEF: Corporation Bank of India Opens Microfinance Branch
Corporation Bank of India (CorpBank), a government-owned bank based in Karnataka, recently opened a microfinance branch in Hyderabad, the capital of the state of Andhra Pradesh.
MICROCAPITAL BRIEF: Indian Microfinance Institutions (MFIs) Spandana Sphoorty, Asmitha, Future, Share, Trident Attempt to Raise Up to $218m in New Loans Amidst Efforts to Restructure Existing Debt
Five Indian microfinance institutions (MFIs) are reportedly looking to raise between INR 800 crores (USD 175 million) and INR 1,000 crores (USD 218 million) in new loans even as they wait for word on proposed debt restructuring plans.
MICROCAPITAL BRIEF: BBC World Service Radio Program Wins One World Media Award for Criticism of Microfinance: “Assignment: India’s Microcredit Meltdown”
The One World Award for a Radio Program, presented annually by UK-based nonprofit One World Media to recognize exceptional coverage of issues in the developing world, has been awarded to the BBC World Service, a radio network supported by the UK government, for its piece entitled “Assignment: India’s Microcredit Meltdown.”
MICROCAPITAL BRIEF: Women’s World Banking (WWB) CEO Mary Ellen Iskenderian Anticipates Risks from “Over-Regulation” of Indian Microfinance Sector
In an email interview published on the website of Indian newspaper Mint, Mary Ellen Iskenderian, President and CEO of Women’s World Banking (WWB), a US-based advisor to and network of microfinance institutions (MFIs), offered an assessment of the Indian microfinance sector and the potential results of new and proposed regulation.
MICROFINANCE EVENT: ACCESS Development Services Announces Microfinance India Summit 2011, New Delhi, India, December 12 – December 13, 2011
Event Name: Microfinance India Summit 2011
Event Date: December 12, 2011 to December 13, 2011
Event Location: Hotel Ashok, New Delhi, India
MICROCAPITAL BRIEF: BlueOrchard Invests $1m in Svasti Microfinance Private Limited of India
Grameen Capital India, a Mumbai-based, socially-oriented advisory firm, recently announced that BlueOrchard, a Switzerland-based microfinance investment company, made an equity investment of INR 45 million (USD 1.01 million) in Svasti Microfinance Private Limited (Svasti), an Indian microfinance institution (MFI).