Expanding Your Microfinance World View
Posted in Featured News on Dec 4th, 2010
4 December 2010 [Syminvest] Private equity companies may struggle to recoup almost $565 million in investments in India’s microfinance industry since 2006 after a regulatory backlash led at least two firms to delay initial public offerings. Temasek Holdings Pte, billionaire George Soros and Sequoia Capital are among investors who’ve put money into the world’s largest [...]
Posted in Featured News on Dec 1st, 2010
1 December 2010 [VCCircle] There could be private capital inflow of at least Rs 1,500 cr (subject to deal closures) in the short term. The short-lived euphoria of India’s first blockbuster microfinance IPO, SKS Microfinance, and the business environment uncertainty in Andhra Pradesh (following regulatory changes), which is the hub of MFI activity in the [...]
Posted in Featured Articles on Nov 30th, 2010
30 December 2010 [iStockAnalyst] The crisis that’s gripped the microfinance institutions (MFIs) may have wider implications for social for-profit business models. While the government is aiming to establish a framework for the MFI industry, investors are now carefully checking how “social” such ventures really are and whether a promoter is committed enough to differentiate between [...]
Posted in Featured Articles on Nov 30th, 2010
By Lindsay Clinton Editor of Beyond Profit & AVP at Intellecap 30 November 2010 [Good.Is] Rumors of the death of microfinance in India have been greatly exaggerated. Here’s what’s really happening. Until recently, microfinance was the darling of poverty alleviation. A foolproof way to pull people out of $2-a-day poverty. But, now, the microfinance sector in India [...]
Posted in Featured Articles on Nov 28th, 2010
By Arvind Ashta Finance Professor & Microfinance Chair at the Burgundy School of Business 28 November 2010 [TheAfricaReport] Amidst a crisis in the Indian microfinance industry, legislators and bankers are asking if an interest rate ceiling in necessary to protect consumers and strengthen the performance of nonviable institutions. There is no global consensus on how [...]
Posted in Featured Articles on Nov 26th, 2010
By Parmesh Shah 26 November 2010 [CGAP] This post is the next in a special blog series on the microfinance crisis in Andhra Pradesh, India. Over the coming weeks we’ll be featuring a variety of voices on the issues raised by this crisis and what it means for the future direction of microfinance. We welcome [...]
Posted in Featured News on Nov 25th, 2010
By Ruth David 25 November 2010 [BusinessWeek] India’s finance ministry plans to introduce new legislation for the nation’s microfinance industry, a federal minister said yesterday. The Micro Finance (Development & Regulation) Bill, 2010, will be developed in consultation with the central bank, Namo Narain Meena, the junior finance minister, said in a written statement to [...]
Posted in Featured Articles on Nov 24th, 2010
By Tim Ogden Executive Partner at Sona Partners 24 November 2010 [SSIReview] Many, including SSIR editor Tamara Straus, have characterized recent news from the microfinance industry as “largely depressing.” Straus used those words to describe the findings of microfinance impact studies. Others are depressed by the debacle underway in Andhra Pradesh, India—one of the epicenters [...]
Posted in Featured Articles on Nov 23rd, 2010
23 November 2010 [WSJ] Microfinance in India is in crisis because of the backlash against lenders in the southern state of Andhra Pradesh, the heart of the industry, where politicians have ordered borrowers not to repay their debts. The industry also faces an uncertain regulatory future with the state introducing new restrictions on lenders and [...]
Posted in Featured News on Nov 23rd, 2010
23 November 2010 [BusinessStandard] Faced with a liquidity crunch, microfinance companies have asked the Reserve Bank of India (RBI) to direct banks to set up an emergency fund of Rs 1,000 crore to help them tide over slowdown in their business. Sources said the Microfinance Institution Network (MFIN) is trying to convince the RBI in [...]
Posted in Featured News on Nov 23rd, 2010
By Tamal Bandyopadhyay 23 November 2010 [Livemint] India’s finance minister Pranab Mukherjee says the government doesn’t want to “strangulate” the microfinance industry that is in the business of giving tiny loans to poor people. At the same time, he asserts that the industry should bring down interest rates to a “reasonable” level and stop using [...]
Posted in Featured News on Nov 22nd, 2010
By Mobis Philipose 22 November 2010 [Livemint] The asset quality of microfinance institutions (MFIs) is under pressure, after measures taken by the Andhra Pradesh (AP) government to tighten regulations governing the industry Shares of banking companies have been under pressure lately after having outperformed the market sharply in preceding months. One of the concerns investors [...]
Posted in Featured Articles on Nov 21st, 2010
21 November 2010 [Triodos] The microfinance sector in India, especially in the state of Andhra Pradesh, has been the subject of extremely critical comments in the international press in the last few weeks. Triodos Investment Management actively invests in the microfinance sector through various funds – including in India. We consider it very important to [...]
Posted in Featured News on Nov 21st, 2010
21 November 2010 [Syminvest] Share Microfin Ltd., backed by New Zealand billionaire Christopher Chandler, plans to delay an initial public offering after rival microfinance companies in India sought emergency funds to cope with rising loan defaults. The lender, based in Hyderabad, had planned to raise 10 billion rupees ($221 million) in early 2011, Philip Vassiliou, [...]
Posted in Featured Articles on Nov 20th, 2010
By Alex Counts CEO & President Grameen Foundation 20 November 2010 [GFBlog] Recent reporting about the activities of for-profit microfinance institutions (MFIs) in India, specifically in the state of Andhra Pradesh, has raised important questions about whether microfinance is delivering on its promise to empower poor people. We take the concerns raised extremely seriously and [...]
Posted in Featured Articles on Nov 19th, 2010
19 November 2010 [TheEconomist] There are Better Ways to Regulate the Industry MICROFINANCE is an example of something that is sadly all too rare: an anti-poverty tool that usually at least breaks even. If you make small, uncollateralised business loans to groups of poor women, they almost always repay them on time. It has grown [...]
Posted in Featured News on Nov 19th, 2010
19 November 2010 [Syminvest] Brokerage says banks purchasing loan pools from MFIs under pressure. The Andhra Pradesh government’s ordinance to curb the activities of microfinance institutions (MFIs) has resulted in a wave of apprehension in the industry which is suffering from an acute financial crisis following a steep drop in repayments. Many MFIs have approached [...]
Posted in Featured Articles on Nov 17th, 2010
By Eric Bellman 17 November 2010 [WSJ] Dear Esteemed Politicians and Bureaucrats of Andhra Pradesh: The backlash against microfinance institutions is threatening to cripple the industry that gives tiny loans to mini entrepreneurs. (Reuters) Please take 10 minutes to consider some important numbers before you destroy the one industry in your lovely southern state that [...]
Posted in Featured News on Nov 10th, 2010
By Nidhi Dutt 10 November 2010 [BBC News] A young widow sits in the middle of the dusty floor of her small mud brick house. Her world, as a poor single mother in rural India, is as bare and as empty as the walls she stares at. Lakshmamma had a micro-loan of about $200 that [...]
Posted in Featured News on Nov 6th, 2010
By K V Ramana 6 November 2010 [Daily News & Analysis] The Andhra Pradesh government has decided to go ahead with the introduction of a Bill to regulate microfinance institutions (MFIs) in the state despite all resistance. The legislation will focus on curbing extortion from the borrowers under the guise of interest and the coercive [...]
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