The Reserve Bank of India (RBI) recently stated that it has no solution for microfinance institutions (MFIs) whose clients refuse to repay their loans amidst the recent turmoil in India’s microfinance industry.
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MICROCAPITAL BRIEF: International Finance Corporation (IFC) Proposes $10m Investment in Shree Mahila Self Employed Women’s Association (SEWA) Bank of Gujarat, India, for Microfinance
The International Finance Corporation (IFC), the investment arm of the World Bank Group, a multilateral development finance organization based in Washington DC, has submitted a proposal to its board of directors for an investment of up to USD 10 million in Shree Mahila Self Employed Women’s Association (SEWA) Bank, subject to regulatory approval by the Reserve Bank of India (RBI).
MICROCAPITAL BRIEF: Indian Banks Agree to Reschedule Loans to Microfinance Institutions (MFIs) Contingent on Their Rescheduling Loans to End-borrowers
Indian banks that have disbursed loans to microfinance institutions (MFIs) may have reached an agreement with the MFIs regarding their requests to reschedule their loan payments.
MICROCAPITAL BRIEF: Urged By Local Politicians, Microfinance Borrowers in India’s West Bengal State Stop Repaying Their Loans
Microfinance borrowers in Bolpur, a town in the Indian state of West Bengal, reportedly have stopped paying back their loans to microfinance institutions (MFIs) at the urging of local politicians in the hopes that their debts will be waived.
MICROCAPITAL BRIEF: Indian Government Launches Life Insurance for Self-Help Groups (SHGs)
The Indian government has introduced a life insurance scheme for members of self-help groups (SHGs), village-based groups of about 10 to 20 women that offer savings and loans to their members, in an effort reassure bankers who invest in SHGs.
MICROCAPITAL BRIEF: UK, Silicon Valley Entrepreneurs Set Sights on India with Shanti Microfinance Fund
A number of UK and Silicon Valley entrepreneurs, including Brent Hoberman, founder of Lastminute.com, and venture capitalist John Hummer, one of the early investors in Napster, have gathered to back Shanti Microfinance, a not-for-profit microfinance fund founded and headed by Sheetal Mehta Walsh, who was till recently the Director of Venture Capital Relations at computing giant Microsoft.
MICROCAPITAL BRIEF: Microfinance Institutions (MFIs) in India Take Legal Action Against Yes Bank for Loan Recall
Several microfinance institutions (MFIs) in India announced that they will be taking legal action against Yes Bank, a private-sector bank headquartered in Mumbai, for recalling loans totaling several billion rupees (the equivalent of tens of millions of US dollars).
MICROCAPITAL BRIEF: Rating Agency Crisil Downgrades Five Indian Microfinance Institutions (MFIs)
Crisil, a credit rating agency based in Bangalore, India, has downgraded its rating of five Indian microfinance institutions (MFIs), citing low debt collections in Andhra Pradesh.
MICROCAPITAL BRIEF: Belgian Incofin Investment Management Makes $ 2.21m Equity Investment in Indian Microfinance Institution (MFI) Hope Microcredit
Incofin Investment Management, a firm based in Belgium, recently made an INR 100 million (approximately USD 2.21 million) equity investment in Indian microfinance institution (MFI) Hope Microcredit, which is based in Kerala.
MICROCAPITAL BRIEF: Yes Bank of India Recalls Approximately $22m in Loans Advanced to Microfinance Institutions (MFIs)
Yes Bank Limited, a private bank based in Mumbai, India, has reportedly recalled approximately INR 1 billion (USD 22.2 million) in loans it advanced to microfinance institutions (MFIs).
MICROCAPITAL BRIEF: SKS Microfinance Shares Off 9% Amidst Uncertainty Surrounding Indian Microfinance Sector
Shares of SKS Microfinance, India’s only listed microfinance institution, tumbled to an all-time low on Monday, December 20, as uncertainty surrounding the country’s microfinance sector remained high.
MICROFINANCE BRIEF: State Bank of India (SBI) Considers Restructuring Loans to “Non-Performing” Microfinance Institutions (MFIs)
The State Bank of India (SBI), a state-owned financial services company, has announced that it may restructure loans given to microfinance institutions (MFIs) that enter “non-performing” status.
MICROCAPITAL BRIEF: Grameen Foundation, Grameen Capital India and Grameen-Jameel Announce $8m Guarantee Pool to Improve Liquidity of Indian Microfinance Institutions (MFIs)
Grameen Foundation, a US-based nonprofit; Grameen Capital India, a Mumbai-based social business that promotes growth in the microfinance sector in India; and Grameen-Jameel, a joint venture founded in 2007 by the Grameen Foundation and Grow Well Limited of Saudi Arabia, have launched a new initiative to address the liquidity needs of Indian microfinance institutions (MFIs) that demonstrate a focus on social as well as financial returns.
MICROCAPITAL BRIEF: ACCESS Development Services of India Releases “State of the Sector Report 2010” Questioning Role of Microfinance Institutions (MFIs) as Responsible Lenders
ACCESS Development Services, a nonprofit offering consulting services to microfinance institutions (MFIs), has released its “State of the Sector Report 2010,” (not yet available online) which questions whether MFIs are responsible lenders, citing “supernormal” profits for Indian MFIs compared to Indian commercial banks.
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: Muthoot Fincorp, ACCION International Join to Increase Microfinance Lending in India
Muthoot Fincorp, a finance company serving retail and institutional customers in India, and ACCION International, a US-based nonprofit with affiliated microfinance institutions (MFIs) in 23 countries, have joined together in an effort to increase lending in India’s microfinance sector.
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.