Business Standard

Madras HC rejects petition to curb micro-lending in state

Related News

The has not granted relief to a petitioner seeking the introduction of legislation in Tamil Nadu to curb activities by private players in the state.

A similar law passed by the in October, 2010, which banned weekly collection of dues, severely affected microlenders, eroding their profitability and threatening their existence.

The high court, however, said the state government should step in to protect the interest of self-help groups if it found microfinance institutions (MFIs) were resorting to “unfair and unhealthy” practices. It added there was a need to empower self-help groups.

“We also hope steps taken by the Reserve Bank of India (RBI) in introducing the Micro Financial Institutions Bill becomes an Act to provide the necessary safeguard to affected parties and provide a successful check on the unhealthy practices of MFIs,” judge Chitra Venkataraman stated in the order, a copy of which is with Business Standard.

said the judgment was positive for the sector, as curbing microfinance activities by private firms would not only hurt the recovery of the sector, but also impact the rural poor who do not have access to formal banking channels.

Read more on:   
|
|
|
|

Read More

Responsible and pragmatic: Amitabh Chaudhry

There has been a high level of focus on financial and capital markets with a slew of measures

Advertisements

Quick Links

More news from Finance Rss icon

Increase in provisions pulls down IDFC's net profit by 14% in Q2

The board also approved the demerger of financial undertaking of IDFC into IDFC Bank

Andhra Bank Q2 net more than doubles at Rs 144.5 crore

Retail credit saw high growth during the quarter registering an year on year increase of 18.6%

Vijaya Bank raises Rs 500 cr via bonds

The bank has shareholders nod to raise additional equity capital of Rs 600 crore from the markets

Back to Top