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Isaac hints at law to curb microfinancing

Finance Minister T.M. Thomas Isaac has said the State government may push a legislation to regulate lending by microfinance institutions.

Addressing a press conference here on Sunday, he pointed out the relevance of the Andhra Pradesh Microfinance Institutions (Regulation of Money Lending) Bill, 2010.

“The entry of the Janasree Sustainable Development Mission into the microfinance sector poses a risk. Leader of the Opposition Oommen Chandy should clarify his stand on the risk involved. The Janasree mission's non-banking financial company might raise money from the market. Profit will be the motive. Loans will be disbursed at high interest rates. The crisis triggered by S.K.S. Microfinance in Andhra Pradesh is a case in point. Suicides by customers have been reported in Andhra Pradesh forcing the government to introduce legislation,” he said.

He criticised the Union government for not giving the State government its due during functions to inaugurate the Vallarpadam International Container Transshipment Terminal and the new terminal at the Thiruvananthapuram international airport.

“Union Ministers showed their pettiness. Defence Minister A.K. Antony was not expected to dole out such treatment. May be, newcomers had offered advice,” he said.