Vikram Akula, founder and chairperson of SKS Microfinance, an Indian microfinance institution (MFI), recently provided thoughts about the microlending industry in India pending SKS Microfinance’s upcoming initial public offering (IPO) amid criticism regarding SKS Microfinance’s interest rates and the debate over whether MFIs should operate on a nonprofit or for-profit basis.
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MICROCAPITAL BRIEF: Indian Microfinance Institution SKS Microfinance Receives Initial Public Offering (IPO) Approval from Securities and Exchange Board of India
SKS Microfinance, an Indian microfinance institution, recently received approval from the Securities and Exchange Board of India for its planned initial public offering (IPO).
MICROCAPITAL BRIEF: Microfinance Institution in India, SKS Microfinance, Reports NCDs, Commercial Paper Will Help Cut Lending Rates by 200 Basis Points
In a release from IndiaMicrofinance.com, it is reported that SKS Microfinance, an Indian microfinance institution (MFI) which claimed assets of USD 596 million for 2009, will be able to lower its retail lending rates by 200 basis points to 26.3 percent by lowering its costs of funds through the issuance of non-convertible debentures (NCDs) and commercial paper.
MICROCAPITAL BRIEF: Microloan Default Risk Rises in India as SKS Microfinance Plans Initial Public Offering (IPO)
A trend in initial public offerings (IPOs) by microfinance institutions in India could potentially increase the risk of defaults by microborrowers. SKS Microfinance, an Indian microfinance institution, has recently filed to raise up to USD 250 million in an initial public offering (IPO), as initially reported by MicroCapital on March 9, 2010. This pending IPO is causing concern that an IPO trend in India could trigger a trend in microfinance institutions’ (MFIs’) funding sources, as reported by MicroCapital on June 16, 2010, which could raise the risk of loan defaults by pressuring MFIs to disburse riskier microloans.
MICROCAPITAL BRIEF: India’s SKS Microfinance IPO Could Trigger Trend in Microlending
SKS Microfinance has recently filed to raise up to USD 250 million in an initial public offering (IPO), as initially reported by MicroCapital on March 9, 2010. The pending IPO, to be offered on the Bombay Stock Exchange and the National Stock Exchange of India, would be the first public offering for an Indian microlender and is resulting in debate about the future of funding microfinance institutions.
MICROCAPITAL BRIEF: India-based Microfinance Institution (MFI) SKS Microfinance Plans to Apply for Commercial Banking License
SKS Microfinance, an Indian microfinance institution (MFI) registered as a non-banking financial company (NBFC), reportedly has plans to apply for a commercial banking license. An unnamed source told Indian news agency, Press Trust of India, that “SKS Microfinance is likely to approach the Reserve Bank [of India] for a banking license once the guidelines are issued.”
MICROCAPITAL BRIEF: Initial Public Offering (IPO) of India-based Microfinance Institution (MFI) SKS Microfinance Raises Questions about Ethics within the Industry
With the initial public offering (IPO) of SKS Microfinance, an Indian microfinance institution (MFI), expected to raise USD 250 million to USD 350 million for the MFI and its private equity (PE) investors, questions have been raised about the ethics of MFI investors profiting millions of dollars when their customers are poor.
MICROCAPITAL BRIEF: SKS Microfinance Limited, Microfinance Institution (MFI) in India, Files to Raise $250m in Initial Public Offering (IPO)
There are now more details available regarding the much-anticipated initial public offering (IPO) of SKS Microfinance Limited, a microfinance institution (MFI) based in India, which MicroCapital covered most recently on March 9, 2010.
MICROCAPITAL BRIEF: Sequoia Capital India, Sandstone Capital, Kismet Capital Advisors and SKS Trust for the Benefit of Women Entrepreneurs Replace SKS Microfinance Founder Mr Vikram Akula as Promoter of the Company
A group of four venture capital companies have replaced Mr Vikram Akula, founder of the Indian microfinance institution (MFI) SKS Microfinance, as promoter of the firm.
MICROCAPITAL BRIEF: SKS Microfinance, a Microfinance Institution (MFI) Based in India, Expected to File for Initial Public Offering (IPO) in Next Four Weeks
SKS Microfinance Limited, a microfinance institution (MFI) based in India, is expected to file for an initial public offering (IPO) in the next three to four weeks, according to three sources that news provider, Reuters, does not name.
MICROCAPITAL BRIEF: Indian Microfinance Institution SKS Microfinance Raises $21m from Debentures and Commercial Paper
SKS Microfinance, a microfinance institution in India, recently raised INR 100 crore (the equivalent of USD 21 million) by issuing INR 50 crore (the equivalent of USD 10.5 million) worth of non-convertible debentures to Bajaj Allianz Life Insurance Company, an Indian life insurance provider, and INR 50 crore worth of commercial paper to Religare Asset Management Company, a mutual fund.
MICROCAPITAL BRIEF: SKS Microfinance Selects SoftXpand Software
SKS Microfinance, India’s largest microfinance institution, recently chose desktop virtualization software SoftXpand to meet its computing needs.
MICROCAPITAL BRIEF: Catamaran Venture Capital Fund to Invest in SKS Microfinance Ltd, an Indian Microfinance Institution Expected to Soon Launch an Initial Public Offering (IPO)
N R Narayana Murthy, founder and former CEO of Infosys, a global consulting and information technology services company based in India, will reportedly invest in SKS Microfinance Ltd, an Indian microfinance institution (MFI) expected to soon float an initial public offering (IPO).
MICROCAPITAL BRIEF: SKS Microfinance Partners with State Bank of India (SBI), State Bank of Hyderabad (SBH) and State Bank of Mysore (SBM) to Integrate 600 Branches
SKS Microfinance has signed agreements to launch an integrated cash management system for 600 of its branches: 390 branches will partner with State Bank of India (SBI), 150 with State Bank of Hyderabad (SBH) and 60 with State Bank of Mysore (SBM).
MICROCAPITAL BRIEF: German Development Bank ‘KfW’ Provides $2.1m to Housing Development Finance Corporation (HDFC) to Loan to SKS Microfinance to Provide Loans to Low-Income Women for Home Improvement
KfW, the German Development Bank, The Housing Development Finance Corporation (HDFC), an Indian mortgage lender, and SKS Microfinance, an Indian microfinance institution (MFI), have entered an agreement to provide loans for home improvement to, primarily, low-income women [1,2,3]. Under a “special agreement,” KfW will provide HDFC with the funds for the project [1]. For the first tranche of funding, KfW will provide HDFC with INR 10 Crore, the equivalent of over USD 2.1 million, to loan to SKS [1]. In turn, SKS will loan to borrowers that have had at least three years of “good credit history” with the MFI [1]. Further details on the arrangement between KfW and HDFC – such as whether the financing is a grant or loan – have not been made public. The companies have indicated that the loans will mainly be extended for the improvement of homes that also serve as a site of an “income generating activity” [1]. Loan sizes will range from INR 50,000, the equivalent of over USD 1,080, to INR 150,000, the equivalent of over USD 3,240 [1]. Borrowers will have three to five years to repay the loans [1]. The interest rate will be 21 percent fixed on a reducing basis [1]. Renu Sud Karnad, the managing director of HDFC, has indicated that there will be more funding for the program in the future [1].
MICROCAPITAL.ORG BRIEF: SKS Microfinance Links with Axis, ICICI, and HDFC Banks for Excess Cash Management
SKS Microfinance plans to collaborate with three private banks to launch an integrated cash management system (CMS) for 575 of its rural branches. Three hundred of its branches would partner with Axis Bank, 175 branches with ICICI Bank, and 100 branches with HDFC Bank. These branches would “have bank accounts which are integrated to an Internet portal,” said S. Dilli Raj, the chief financial officer of SKS Microfinance, which could enable information on funds and cash availability to be more readily accessible for use in providing financial services.
MICROCAPITAL.ORG STORY: SKS Microfinance Planning to Expand Network into Punjab, India
SKS Microfinance, an Indian non-banking microfinance institution (MFI), recently announced plans to expand its network into Punjab, India. Mr. Rao, COO of SKS Microfinance said “Punjab has approximately 2 [million] people living Below Poverty Line, with a credit demand of Rs 1,168 crore [USD 2.5 million]” [1]. According to a previous statement released by SKS, its expansion into Punjab will take place primarily in urban areas [2].
MICROCAPITAL.ORG STORY: SEWA, SKS Microfinance and The Aryavart Gramin Bank Provide Alternative Power to the Rural Poor
A number of Indian MFI’s now provide loans for cost effective alternative power to people who have little or no access to electricity. With heavy reliance on kerosene and firewood, millions of homes have little or no light after dark. And the time spent collecting firewood or waiting in line to purchase kerosene leaves little time for income generating activities. This makes it difficult for many of the rural and urban poor to elevate themselves out of poverty.