GOVERNMENT OF
MINISTRY OF
FINANCE
DEPARTMENT OF
FINANCIAL SERVICES
- - - -
RAJYA SABHA
UNSTARRED QUESTION NO.
50
TO BE ANSWERED ON THE 9TH NOVEMBER, 2010/ 18TH KARTIKA, 1932 (SAKA)
HARRASSMENT BY
MICRO-FINANCE INSTITUTIONS
50: SHRI Y.S. CHOWDARY:
Will
the Minister of
FINANCE be pleased to state:
(a) the details of major domestic and
foreign companies engaged in micro- finance in
(b) the details of annual interest earned
by these companies during the last three years;
(c) whether Government is aware of the
suicide committed by people in Andhra Pradesh and other
States due to
harassment by these companies;
(d) if so, the details
thereof;
(e) whether Government intends to impose cap
on rates of interest charged by these companies and also to bring in any
regulatory authority; and
(f) if so, the details thereof?
ANSWER
THE MINISTER OF STATE IN THE MINISTRY OF
FINANCE
(SHRI NAMO NARAIN
MEENA )
- - - - -
(a) & (b): The Small Industrial
Development Bank of India(SIDBI) has reported details of the major companies
engaged in Micro Finance in India and their annual turnover during the last
three financial years(FY), as under:
(Rs.
Crore)
|
Name of the MFI |
Outstanding
Loan Portfolio |
||
|
|
FY
2008 |
FY
2009 |
FY
2010 |
|
SKS Microfinance Ltd |
1050.67 |
2456.82 |
2974.69 |
|
Spandana
Sphoorty Financial Ltd |
731.34 |
1797.96 |
2130.08 |
|
Share Microfin Ltd |
608.93 |
1216.93 |
1693.54 |
|
Bandhan
Financial Services Pvt Ltd |
52.68 |
149.35 |
1195.06 |
|
Asmitha
Microfin Ltd |
335.85 |
707.10 |
1418.53 |
|
Bhartiya
Samruddhi Finance Ltd |
225.41 |
462.12 |
772.31 |
|
Equitas
Microfinance India Pvt Ltd |
16.74 |
288.02 |
605.03 |
|
Future Financial Services Ltd |
76.65 |
118.27 |
243.87 |
|
Ujjivan
Financial Services Pvt. Ltd. |
36.57 |
168.98 |
370.77 |
|
BWDA Finance Ltd |
85.14 |
104.20 |
118.99 |
The details of income earned by these companies during the last three
years is as under:
(Rs.
Crore)
|
Name
of the MFI |
Income
during the year |
||
|
|
FY
2008 |
FY
2009 |
FY
2010 |
|
SKS Microfinance
Ltd |
170.01 |
554.00 |
958.93 |
|
Spandana
Sphoorty Financial Ltd |
127.45 |
356.68 |
724.09 |
|
Share Microfin Ltd |
113.12 |
258.21 |
475.27 |
|
Bandhan
Financial Services Pvt Ltd |
7.45 |
37.04 |
274.07 |
|
Asmitha
Microfin Ltd |
65.02 |
144.61 |
285.57 |
|
Bhartiya
Samruddhi Finance Ltd |
52.32 |
103.21 |
220.89 |
|
Equitas
Microfinance India Pvt Ltd |
0.75 |
34.97 |
124.10 |
|
Future Financial
Services Ltd |
9.93 |
27.34 |
44.29 |
|
Ujjivan
Financial Services Pvt. Ltd. |
5.33 |
28.03 |
83.99 |
|
BWDA Finance Ltd. |
15.21 |
19.05 |
22.68 |
(c ) to (f): The Government of India had in September, 2010 written to
all Chief Executive Officers of Public Sector Banks advising them to ensure
that the rates of interest charged by the MFIs to the
eventual beneficiaries are reasonable.
The Banks were also advised to ensure that MFIs
do not resort to ever greening of the loans.
In this regard, the RBI through its Master Circular on the Fair Practice
Code dated July 1st, 2010, advised NBFCs
that though Interest Rates are not regulated by the RBI, rates of interest
beyond a certain level may be seen to be excessive and can neither be
sustainable nor be confirming to normal financial practice. The Boards of NBFCs were therefore advised to lay out appropriate
principles and procedures and determine interest rates, processing and other
charges.
There have been
reports about suicides in the State of Andhra Pradesh(A.P)
. The A.P. Government was of the view that these suicides are related to the
usurious rates of interest and the recovery practices being adopted by the MFIs. To curb these practices, the A.P. Government
promulgated the Andhra Pradesh Microfinance Institution (Regulation of
Moneylenders) Ordinance, 2010 on 15th October, 2010. Recently, the RBI has set up a Sub-Committee
of the Central Board of Directors of the Reserve Bank to study the issues and
concerns in the microfinance sector.
******