Deprecated (16384): The ArrayAccess methods will be removed in 4.0.0.Use getParam(), getData() and getQuery() instead. - /home/brlfuser/public_html/src/Controller/ArtileDetailController.php, line: 73
 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php. [CORE/src/Core/functions.php, line 311]
Code Context


        trigger_error($message, E_USER_DEPRECATED);

    }
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 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php.'
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deprecationWarning - CORE/src/Core/functions.php, line 311
Cake\Http\ServerRequest::offsetGet() - CORE/src/Http/ServerRequest.php, line 2421
App\Controller\ArtileDetailController::printArticle() - APP/Controller/ArtileDetailController.php, line 73
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Cake\Http\ActionDispatcher::_invoke() - CORE/src/Http/ActionDispatcher.php, line 120
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Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
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Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
Cake\Error\Middleware\ErrorHandlerMiddleware::__invoke() - CORE/src/Error/Middleware/ErrorHandlerMiddleware.php, line 96
Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
Cake\Http\Runner::run() - CORE/src/Http/Runner.php, line 51
Cake\Http\Server::run() - CORE/src/Http/Server.php, line 98

Deprecated (16384): The ArrayAccess methods will be removed in 4.0.0.Use getParam(), getData() and getQuery() instead. - /home/brlfuser/public_html/src/Controller/ArtileDetailController.php, line: 74
 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php. [CORE/src/Core/functions.php, line 311]
Code Context


        trigger_error($message, E_USER_DEPRECATED);

    }
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 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php.'
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deprecationWarning - CORE/src/Core/functions.php, line 311
Cake\Http\ServerRequest::offsetGet() - CORE/src/Http/ServerRequest.php, line 2421
App\Controller\ArtileDetailController::printArticle() - APP/Controller/ArtileDetailController.php, line 74
Cake\Controller\Controller::invokeAction() - CORE/src/Controller/Controller.php, line 610
Cake\Http\ActionDispatcher::_invoke() - CORE/src/Http/ActionDispatcher.php, line 120
Cake\Http\ActionDispatcher::dispatch() - CORE/src/Http/ActionDispatcher.php, line 94
Cake\Http\BaseApplication::__invoke() - CORE/src/Http/BaseApplication.php, line 235
Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
Cake\Routing\Middleware\RoutingMiddleware::__invoke() - CORE/src/Routing/Middleware/RoutingMiddleware.php, line 162
Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
Cake\Routing\Middleware\AssetMiddleware::__invoke() - CORE/src/Routing/Middleware/AssetMiddleware.php, line 88
Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
Cake\Error\Middleware\ErrorHandlerMiddleware::__invoke() - CORE/src/Error/Middleware/ErrorHandlerMiddleware.php, line 96
Cake\Http\Runner::__invoke() - CORE/src/Http/Runner.php, line 65
Cake\Http\Runner::run() - CORE/src/Http/Runner.php, line 51
Cake\Http\Server::run() - CORE/src/Http/Server.php, line 98

Warning (512): Unable to emit headers. Headers sent in file=/home/brlfuser/public_html/vendor/cakephp/cakephp/src/Error/Debugger.php line=853 [CORE/src/Http/ResponseEmitter.php, line 48]
Code Context
            if (Configure::read('debug')) {

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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women&#039;s Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an iron grip on poor women debtors in several States of the country.&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;The resolution drew attention to the &amp;ldquo;spate of suicides as a result of the harassment and strong-arm tactics employed by commercial and profit-oriented corporate MFIs for loan recovery.&amp;rdquo; Taking advantage of the failure of banks to meet the credit needs of the poor, &amp;ldquo;This new breed of moneylenders is luring women to form Self Help Groups, and then charging them exorbitant rates of interest &amp;mdash; as high as 48-60 percent&amp;hellip;Whatever little collectivism has been generated by the SHGs has been systematically destroyed in the process.&amp;rdquo;&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;It highlights the situation in Andhra Pradesh, where &amp;ldquo;32 MFIs are reported to have given loans worth Rs. 25,000 crore to 40 per cent of the poor women in the State. Unable to meet their forcible demands for loan recovery, more than a hundred people have committed suicide in the last three months.&amp;rdquo; The ordinance promulgated by the Government of Andhra Pradesh is an eye-wash as it does not put a cap on the interest rates that MFIs can charge.&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;The resolution calls for an immediate Central law to cap interest rates charged by MFIs, and to regulate their operations; to file criminal cases against MFIs engaged in extortionist practices; to cap interest rates from banks to SHGs at four per cent and cap loans given by MFIs to not more than two per cent above the banks interest rates to MFIs; and to expand cheap credit facilities through direct banking to SHGs.&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;&amp;ldquo;From the village money-lender to the corporate money-lender&amp;rdquo; &amp;mdash; is how Taposhi Praharaj, Vice-President of the Orissa unit of AIDWA, described the credit situation in her State. The AIDWA unit in Orissa surveyed 600 SHGs in 12 districts of the State, including those that have taken government loans; those that have taken loans from government and MFIs; and those that borrowed only from MFIs. The last category accounts for 70 per cent of the SHGs surveyed.&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;The survey found that MFIs had penetrated deep into villages and towns. While on paper, the rate of interest is a flat 10 per cent, the interest charged is on the entire principal through the repayment period, with cuts made from the principal amount under several heads &amp;mdash; such as processing fee, bank charges, agreement charges, membership charges and so on. &amp;ldquo;The compounded interest is never less than 52 per cent, and we found that on the last 10 rupee instalment, the interest is 525 percent!&amp;rdquo;&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;Measures of recovery are harsh. Agents operate through the head of the SHG the debtor belongs to, and take away her every possession. &amp;ldquo;Bilashini Behra from Bhubaneshwar took loans from three MFIs, each successive one to pay the previous. She committed suicide because she could ultimately not repay,&amp;rdquo; said Ms. Praharaj.&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;&amp;ldquo;The Central government, with the view that this can attract Foreign Direct Investment, has moved a Bill on MFIs,&amp;rdquo; said Rajya Sabha MP Brinda Karat. &amp;ldquo;There is no cap on interest, so that women&#039;s savings can be taken control of, destroying the autonomy of SHGs. In fact, when I met the Andhra Pradesh Chief Minister with an AIDWA delegation, he categorically told me that he had instructions from the Centre that there should be no cap on interest rates.&amp;rdquo;&lt;/font&gt;&lt;br /&gt;
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&lt;br /&gt;
&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;It highlights the situation in Andhra Pradesh, where &amp;ldquo;32 MFIs are reported to have given loans worth Rs. 25,000 crore to 40 per cent of the poor women in the State. Unable to meet their forcible demands for loan recovery, more than a hundred people have committed suicide in the last three months.&amp;rdquo; The ordinance promulgated by the Government of Andhra Pradesh is an eye-wash as it does not put a cap on the interest rates that MFIs can charge.&lt;/font&gt;&lt;br /&gt;
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Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women&#039;s Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an...&#039;
$disp = &#039;&lt;font &gt;&lt;br /&gt;&lt;/font&gt;&lt;div align=&quot;justify&quot;&gt;&lt;font &gt;Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women&#039;s Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an iron grip on poor women debtors in several States of the country.&lt;/font&gt;&lt;br /&gt;&lt;br /&gt;&lt;font &gt;The resolution drew attention to the &amp;ldquo;spate of suicides as a result of the harassment and strong-arm tactics employed by commercial and profit-oriented corporate MFIs for loan recovery.&amp;rdquo; Taking advantage of the failure of banks to meet the credit needs of the poor, &amp;ldquo;This new breed of moneylenders is luring women to form Self Help Groups, and then charging them exorbitant rates of interest &amp;mdash; as high as 48-60 percent&amp;hellip;Whatever little collectivism has been generated by the SHGs has been systematically destroyed in the process.&amp;rdquo;&lt;/font&gt;&lt;br /&gt;&lt;br /&gt;&lt;font &gt;It highlights the situation in Andhra Pradesh, where &amp;ldquo;32 MFIs are reported to have given loans worth Rs. 25,000 crore to 40 per cent of the poor women in the State. Unable to meet their forcible demands for loan recovery, more than a hundred people have committed suicide in the last three months.&amp;rdquo; The ordinance promulgated by the Government of Andhra Pradesh is an eye-wash as it does not put a cap on the interest rates that MFIs can charge.&lt;/font&gt;&lt;br /&gt;&lt;br /&gt;&lt;font &gt;The resolution calls for an immediate Central law to cap interest rates charged by MFIs, and to regulate their operations; to file criminal cases against MFIs engaged in extortionist practices; to cap interest rates from banks to SHGs at four per cent and cap loans given by MFIs to not more than two per cent above the banks interest rates to MFIs; and to expand cheap credit facilities through direct banking to SHGs.&lt;/font&gt;&lt;br /&gt;&lt;br /&gt;&lt;font &gt;&amp;ldquo;From the village money-lender to the corporate money-lender&amp;rdquo; &amp;mdash; is how Taposhi Praharaj, Vice-President of the Orissa unit of AIDWA, described the credit situation in her State. The AIDWA unit in Orissa surveyed 600 SHGs in 12 districts of the State, including those that have taken government loans; those that have taken loans from government and MFIs; and those that borrowed only from MFIs. The last category accounts for 70 per cent of the SHGs surveyed.&lt;/font&gt;&lt;br /&gt;&lt;br /&gt;&lt;font &gt;The survey found that MFIs had penetrated deep into villages and towns. While on paper, the rate of interest is a flat 10 per cent, the interest charged is on the entire principal through the repayment period, with cuts made from the principal amount under several heads &amp;mdash; such as processing fee, bank charges, agreement charges, membership charges and so on. &amp;ldquo;The compounded interest is never less than 52 per cent, and we found that on the last 10 rupee instalment, the interest is 525 percent!&amp;rdquo;&lt;/font&gt;&lt;br /&gt;&lt;br /&gt;&lt;font &gt;Measures of recovery are harsh. Agents operate through the head of the SHG the debtor belongs to, and take away her every possession. &amp;ldquo;Bilashini Behra from Bhubaneshwar took loans from three MFIs, each successive one to pay the previous. She committed suicide because she could ultimately not repay,&amp;rdquo; said Ms. Praharaj.&lt;/font&gt;&lt;br /&gt;&lt;br /&gt;&lt;font &gt;&amp;ldquo;The Central government, with the view that this can attract Foreign Direct Investment, has moved a Bill on MFIs,&amp;rdquo; said Rajya Sabha MP Brinda Karat. &amp;ldquo;There is no cap on interest, so that women&#039;s savings can be taken control of, destroying the autonomy of SHGs. In fact, when I met the Andhra Pradesh Chief Minister with an AIDWA delegation, he categorically told me that he had instructions from the Centre that there should be no cap on interest rates.&amp;rdquo;&lt;/font&gt;&lt;br /&gt;&lt;br /&gt;&lt;/div&gt;&#039;
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Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women's Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an..."/>
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                <strong>Need to regulate microfinance institutions: AIDWA by Parvathi Menon</strong></h1>
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                <font ><br /></font><div align="justify"><font >Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women's Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an iron grip on poor women debtors in several States of the country.</font><br /><br /><font >The resolution drew attention to the &ldquo;spate of suicides as a result of the harassment and strong-arm tactics employed by commercial and profit-oriented corporate MFIs for loan recovery.&rdquo; Taking advantage of the failure of banks to meet the credit needs of the poor, &ldquo;This new breed of moneylenders is luring women to form Self Help Groups, and then charging them exorbitant rates of interest &mdash; as high as 48-60 percent&hellip;Whatever little collectivism has been generated by the SHGs has been systematically destroyed in the process.&rdquo;</font><br /><br /><font >It highlights the situation in Andhra Pradesh, where &ldquo;32 MFIs are reported to have given loans worth Rs. 25,000 crore to 40 per cent of the poor women in the State. Unable to meet their forcible demands for loan recovery, more than a hundred people have committed suicide in the last three months.&rdquo; The ordinance promulgated by the Government of Andhra Pradesh is an eye-wash as it does not put a cap on the interest rates that MFIs can charge.</font><br /><br /><font >The resolution calls for an immediate Central law to cap interest rates charged by MFIs, and to regulate their operations; to file criminal cases against MFIs engaged in extortionist practices; to cap interest rates from banks to SHGs at four per cent and cap loans given by MFIs to not more than two per cent above the banks interest rates to MFIs; and to expand cheap credit facilities through direct banking to SHGs.</font><br /><br /><font >&ldquo;From the village money-lender to the corporate money-lender&rdquo; &mdash; is how Taposhi Praharaj, Vice-President of the Orissa unit of AIDWA, described the credit situation in her State. The AIDWA unit in Orissa surveyed 600 SHGs in 12 districts of the State, including those that have taken government loans; those that have taken loans from government and MFIs; and those that borrowed only from MFIs. The last category accounts for 70 per cent of the SHGs surveyed.</font><br /><br /><font >The survey found that MFIs had penetrated deep into villages and towns. While on paper, the rate of interest is a flat 10 per cent, the interest charged is on the entire principal through the repayment period, with cuts made from the principal amount under several heads &mdash; such as processing fee, bank charges, agreement charges, membership charges and so on. &ldquo;The compounded interest is never less than 52 per cent, and we found that on the last 10 rupee instalment, the interest is 525 percent!&rdquo;</font><br /><br /><font >Measures of recovery are harsh. Agents operate through the head of the SHG the debtor belongs to, and take away her every possession. &ldquo;Bilashini Behra from Bhubaneshwar took loans from three MFIs, each successive one to pay the previous. She committed suicide because she could ultimately not repay,&rdquo; said Ms. Praharaj.</font><br /><br /><font >&ldquo;The Central government, with the view that this can attract Foreign Direct Investment, has moved a Bill on MFIs,&rdquo; said Rajya Sabha MP Brinda Karat. &ldquo;There is no cap on interest, so that women's savings can be taken control of, destroying the autonomy of SHGs. In fact, when I met the Andhra Pradesh Chief Minister with an AIDWA delegation, he categorically told me that he had instructions from the Centre that there should be no cap on interest rates.&rdquo;</font><br /><br /></div>               </font>
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women&#039;s Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an iron grip on poor women debtors in several States of the country.&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;The resolution drew attention to the &amp;ldquo;spate of suicides as a result of the harassment and strong-arm tactics employed by commercial and profit-oriented corporate MFIs for loan recovery.&amp;rdquo; Taking advantage of the failure of banks to meet the credit needs of the poor, &amp;ldquo;This new breed of moneylenders is luring women to form Self Help Groups, and then charging them exorbitant rates of interest &amp;mdash; as high as 48-60 percent&amp;hellip;Whatever little collectivism has been generated by the SHGs has been systematically destroyed in the process.&amp;rdquo;&lt;/font&gt;&lt;br /&gt;
&lt;br /&gt;
&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;It highlights the situation in Andhra Pradesh, where &amp;ldquo;32 MFIs are reported to have given loans worth Rs. 25,000 crore to 40 per cent of the poor women in the State. Unable to meet their forcible demands for loan recovery, more than a hundred people have committed suicide in the last three months.&amp;rdquo; The ordinance promulgated by the Government of Andhra Pradesh is an eye-wash as it does not put a cap on the interest rates that MFIs can charge.&lt;/font&gt;&lt;br /&gt;
&lt;br /&gt;
&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;The resolution calls for an immediate Central law to cap interest rates charged by MFIs, and to regulate their operations; to file criminal cases against MFIs engaged in extortionist practices; to cap interest rates from banks to SHGs at four per cent and cap loans given by MFIs to not more than two per cent above the banks interest rates to MFIs; and to expand cheap credit facilities through direct banking to SHGs.&lt;/font&gt;&lt;br /&gt;
&lt;br /&gt;
&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;&amp;ldquo;From the village money-lender to the corporate money-lender&amp;rdquo; &amp;mdash; is how Taposhi Praharaj, Vice-President of the Orissa unit of AIDWA, described the credit situation in her State. The AIDWA unit in Orissa surveyed 600 SHGs in 12 districts of the State, including those that have taken government loans; those that have taken loans from government and MFIs; and those that borrowed only from MFIs. The last category accounts for 70 per cent of the SHGs surveyed.&lt;/font&gt;&lt;br /&gt;
&lt;br /&gt;
&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;The survey found that MFIs had penetrated deep into villages and towns. While on paper, the rate of interest is a flat 10 per cent, the interest charged is on the entire principal through the repayment period, with cuts made from the principal amount under several heads &amp;mdash; such as processing fee, bank charges, agreement charges, membership charges and so on. &amp;ldquo;The compounded interest is never less than 52 per cent, and we found that on the last 10 rupee instalment, the interest is 525 percent!&amp;rdquo;&lt;/font&gt;&lt;br /&gt;
&lt;br /&gt;
&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;Measures of recovery are harsh. Agents operate through the head of the SHG the debtor belongs to, and take away her every possession. &amp;ldquo;Bilashini Behra from Bhubaneshwar took loans from three MFIs, each successive one to pay the previous. She committed suicide because she could ultimately not repay,&amp;rdquo; said Ms. Praharaj.&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;&amp;ldquo;The Central government, with the view that this can attract Foreign Direct Investment, has moved a Bill on MFIs,&amp;rdquo; said Rajya Sabha MP Brinda Karat. &amp;ldquo;There is no cap on interest, so that women&#039;s savings can be taken control of, destroying the autonomy of SHGs. In fact, when I met the Andhra Pradesh Chief Minister with an AIDWA delegation, he categorically told me that he had instructions from the Centre that there should be no cap on interest rates.&amp;rdquo;&lt;/font&gt;&lt;br /&gt;
&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women&#039;s Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an iron grip on poor women debtors in several States of the country.&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;The resolution drew attention to the &amp;ldquo;spate of suicides as a result of the harassment and strong-arm tactics employed by commercial and profit-oriented corporate MFIs for loan recovery.&amp;rdquo; Taking advantage of the failure of banks to meet the credit needs of the poor, &amp;ldquo;This new breed of moneylenders is luring women to form Self Help Groups, and then charging them exorbitant rates of interest &amp;mdash; as high as 48-60 percent&amp;hellip;Whatever little collectivism has been generated by the SHGs has been systematically destroyed in the process.&amp;rdquo;&lt;/font&gt;&lt;br /&gt;
&lt;br /&gt;
&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;It highlights the situation in Andhra Pradesh, where &amp;ldquo;32 MFIs are reported to have given loans worth Rs. 25,000 crore to 40 per cent of the poor women in the State. Unable to meet their forcible demands for loan recovery, more than a hundred people have committed suicide in the last three months.&amp;rdquo; The ordinance promulgated by the Government of Andhra Pradesh is an eye-wash as it does not put a cap on the interest rates that MFIs can charge.&lt;/font&gt;&lt;br /&gt;
&lt;br /&gt;
&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;The resolution calls for an immediate Central law to cap interest rates charged by MFIs, and to regulate their operations; to file criminal cases against MFIs engaged in extortionist practices; to cap interest rates from banks to SHGs at four per cent and cap loans given by MFIs to not more than two per cent above the banks interest rates to MFIs; and to expand cheap credit facilities through direct banking to SHGs.&lt;/font&gt;&lt;br /&gt;
&lt;br /&gt;
&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;&amp;ldquo;From the village money-lender to the corporate money-lender&amp;rdquo; &amp;mdash; is how Taposhi Praharaj, Vice-President of the Orissa unit of AIDWA, described the credit situation in her State. The AIDWA unit in Orissa surveyed 600 SHGs in 12 districts of the State, including those that have taken government loans; those that have taken loans from government and MFIs; and those that borrowed only from MFIs. The last category accounts for 70 per cent of the SHGs surveyed.&lt;/font&gt;&lt;br /&gt;
&lt;br /&gt;
&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;The survey found that MFIs had penetrated deep into villages and towns. While on paper, the rate of interest is a flat 10 per cent, the interest charged is on the entire principal through the repayment period, with cuts made from the principal amount under several heads &amp;mdash; such as processing fee, bank charges, agreement charges, membership charges and so on. &amp;ldquo;The compounded interest is never less than 52 per cent, and we found that on the last 10 rupee instalment, the interest is 525 percent!&amp;rdquo;&lt;/font&gt;&lt;br /&gt;
&lt;br /&gt;
&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;Measures of recovery are harsh. Agents operate through the head of the SHG the debtor belongs to, and take away her every possession. &amp;ldquo;Bilashini Behra from Bhubaneshwar took loans from three MFIs, each successive one to pay the previous. She committed suicide because she could ultimately not repay,&amp;rdquo; said Ms. Praharaj.&lt;/font&gt;&lt;br /&gt;
&lt;br /&gt;
&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;&amp;ldquo;The Central government, with the view that this can attract Foreign Direct Investment, has moved a Bill on MFIs,&amp;rdquo; said Rajya Sabha MP Brinda Karat. &amp;ldquo;There is no cap on interest, so that women&#039;s savings can be taken control of, destroying the autonomy of SHGs. In fact, when I met the Andhra Pradesh Chief Minister with an AIDWA delegation, he categorically told me that he had instructions from the Centre that there should be no cap on interest rates.&amp;rdquo;&lt;/font&gt;&lt;br /&gt;
&lt;br /&gt;
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Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women&#039;s Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an...&#039;
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Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women's Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an..."/>
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                <strong>Need to regulate microfinance institutions: AIDWA by Parvathi Menon</strong></h1>
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                <font ><br /></font><div align="justify"><font >Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women's Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an iron grip on poor women debtors in several States of the country.</font><br /><br /><font >The resolution drew attention to the &ldquo;spate of suicides as a result of the harassment and strong-arm tactics employed by commercial and profit-oriented corporate MFIs for loan recovery.&rdquo; Taking advantage of the failure of banks to meet the credit needs of the poor, &ldquo;This new breed of moneylenders is luring women to form Self Help Groups, and then charging them exorbitant rates of interest &mdash; as high as 48-60 percent&hellip;Whatever little collectivism has been generated by the SHGs has been systematically destroyed in the process.&rdquo;</font><br /><br /><font >It highlights the situation in Andhra Pradesh, where &ldquo;32 MFIs are reported to have given loans worth Rs. 25,000 crore to 40 per cent of the poor women in the State. Unable to meet their forcible demands for loan recovery, more than a hundred people have committed suicide in the last three months.&rdquo; The ordinance promulgated by the Government of Andhra Pradesh is an eye-wash as it does not put a cap on the interest rates that MFIs can charge.</font><br /><br /><font >The resolution calls for an immediate Central law to cap interest rates charged by MFIs, and to regulate their operations; to file criminal cases against MFIs engaged in extortionist practices; to cap interest rates from banks to SHGs at four per cent and cap loans given by MFIs to not more than two per cent above the banks interest rates to MFIs; and to expand cheap credit facilities through direct banking to SHGs.</font><br /><br /><font >&ldquo;From the village money-lender to the corporate money-lender&rdquo; &mdash; is how Taposhi Praharaj, Vice-President of the Orissa unit of AIDWA, described the credit situation in her State. The AIDWA unit in Orissa surveyed 600 SHGs in 12 districts of the State, including those that have taken government loans; those that have taken loans from government and MFIs; and those that borrowed only from MFIs. The last category accounts for 70 per cent of the SHGs surveyed.</font><br /><br /><font >The survey found that MFIs had penetrated deep into villages and towns. While on paper, the rate of interest is a flat 10 per cent, the interest charged is on the entire principal through the repayment period, with cuts made from the principal amount under several heads &mdash; such as processing fee, bank charges, agreement charges, membership charges and so on. &ldquo;The compounded interest is never less than 52 per cent, and we found that on the last 10 rupee instalment, the interest is 525 percent!&rdquo;</font><br /><br /><font >Measures of recovery are harsh. Agents operate through the head of the SHG the debtor belongs to, and take away her every possession. &ldquo;Bilashini Behra from Bhubaneshwar took loans from three MFIs, each successive one to pay the previous. She committed suicide because she could ultimately not repay,&rdquo; said Ms. Praharaj.</font><br /><br /><font >&ldquo;The Central government, with the view that this can attract Foreign Direct Investment, has moved a Bill on MFIs,&rdquo; said Rajya Sabha MP Brinda Karat. &ldquo;There is no cap on interest, so that women's savings can be taken control of, destroying the autonomy of SHGs. In fact, when I met the Andhra Pradesh Chief Minister with an AIDWA delegation, he categorically told me that he had instructions from the Centre that there should be no cap on interest rates.&rdquo;</font><br /><br /></div>               </font>
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women&#039;s Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an iron grip on poor women debtors in several States of the country.&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;The resolution drew attention to the &amp;ldquo;spate of suicides as a result of the harassment and strong-arm tactics employed by commercial and profit-oriented corporate MFIs for loan recovery.&amp;rdquo; Taking advantage of the failure of banks to meet the credit needs of the poor, &amp;ldquo;This new breed of moneylenders is luring women to form Self Help Groups, and then charging them exorbitant rates of interest &amp;mdash; as high as 48-60 percent&amp;hellip;Whatever little collectivism has been generated by the SHGs has been systematically destroyed in the process.&amp;rdquo;&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;It highlights the situation in Andhra Pradesh, where &amp;ldquo;32 MFIs are reported to have given loans worth Rs. 25,000 crore to 40 per cent of the poor women in the State. Unable to meet their forcible demands for loan recovery, more than a hundred people have committed suicide in the last three months.&amp;rdquo; The ordinance promulgated by the Government of Andhra Pradesh is an eye-wash as it does not put a cap on the interest rates that MFIs can charge.&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;The resolution calls for an immediate Central law to cap interest rates charged by MFIs, and to regulate their operations; to file criminal cases against MFIs engaged in extortionist practices; to cap interest rates from banks to SHGs at four per cent and cap loans given by MFIs to not more than two per cent above the banks interest rates to MFIs; and to expand cheap credit facilities through direct banking to SHGs.&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;&amp;ldquo;From the village money-lender to the corporate money-lender&amp;rdquo; &amp;mdash; is how Taposhi Praharaj, Vice-President of the Orissa unit of AIDWA, described the credit situation in her State. The AIDWA unit in Orissa surveyed 600 SHGs in 12 districts of the State, including those that have taken government loans; those that have taken loans from government and MFIs; and those that borrowed only from MFIs. The last category accounts for 70 per cent of the SHGs surveyed.&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;The survey found that MFIs had penetrated deep into villages and towns. While on paper, the rate of interest is a flat 10 per cent, the interest charged is on the entire principal through the repayment period, with cuts made from the principal amount under several heads &amp;mdash; such as processing fee, bank charges, agreement charges, membership charges and so on. &amp;ldquo;The compounded interest is never less than 52 per cent, and we found that on the last 10 rupee instalment, the interest is 525 percent!&amp;rdquo;&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;Measures of recovery are harsh. Agents operate through the head of the SHG the debtor belongs to, and take away her every possession. &amp;ldquo;Bilashini Behra from Bhubaneshwar took loans from three MFIs, each successive one to pay the previous. She committed suicide because she could ultimately not repay,&amp;rdquo; said Ms. Praharaj.&lt;/font&gt;&lt;br /&gt;
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&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;&amp;ldquo;The Central government, with the view that this can attract Foreign Direct Investment, has moved a Bill on MFIs,&amp;rdquo; said Rajya Sabha MP Brinda Karat. &amp;ldquo;There is no cap on interest, so that women&#039;s savings can be taken control of, destroying the autonomy of SHGs. In fact, when I met the Andhra Pradesh Chief Minister with an AIDWA delegation, he categorically told me that he had instructions from the Centre that there should be no cap on interest rates.&amp;rdquo;&lt;/font&gt;&lt;br /&gt;
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&lt;br /&gt;
&lt;font face=&quot;arial,helvetica,sans-serif&quot; size=&quot;3&quot;&gt;It highlights the situation in Andhra Pradesh, where &amp;ldquo;32 MFIs are reported to have given loans worth Rs. 25,000 crore to 40 per cent of the poor women in the State. Unable to meet their forcible demands for loan recovery, more than a hundred people have committed suicide in the last three months.&amp;rdquo; The ordinance promulgated by the Government of Andhra Pradesh is an eye-wash as it does not put a cap on the interest rates that MFIs can charge.&lt;/font&gt;&lt;br /&gt;
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&lt;br /&gt;
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&lt;br /&gt;
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Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women&#039;s Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an...&#039;
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                <strong>Need to regulate microfinance institutions: AIDWA by Parvathi Menon</strong></h1>
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                <font ><br /></font><div align="justify"><font >Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women's Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an iron grip on poor women debtors in several States of the country.</font><br /><br /><font >The resolution drew attention to the &ldquo;spate of suicides as a result of the harassment and strong-arm tactics employed by commercial and profit-oriented corporate MFIs for loan recovery.&rdquo; Taking advantage of the failure of banks to meet the credit needs of the poor, &ldquo;This new breed of moneylenders is luring women to form Self Help Groups, and then charging them exorbitant rates of interest &mdash; as high as 48-60 percent&hellip;Whatever little collectivism has been generated by the SHGs has been systematically destroyed in the process.&rdquo;</font><br /><br /><font >It highlights the situation in Andhra Pradesh, where &ldquo;32 MFIs are reported to have given loans worth Rs. 25,000 crore to 40 per cent of the poor women in the State. Unable to meet their forcible demands for loan recovery, more than a hundred people have committed suicide in the last three months.&rdquo; The ordinance promulgated by the Government of Andhra Pradesh is an eye-wash as it does not put a cap on the interest rates that MFIs can charge.</font><br /><br /><font >The resolution calls for an immediate Central law to cap interest rates charged by MFIs, and to regulate their operations; to file criminal cases against MFIs engaged in extortionist practices; to cap interest rates from banks to SHGs at four per cent and cap loans given by MFIs to not more than two per cent above the banks interest rates to MFIs; and to expand cheap credit facilities through direct banking to SHGs.</font><br /><br /><font >&ldquo;From the village money-lender to the corporate money-lender&rdquo; &mdash; is how Taposhi Praharaj, Vice-President of the Orissa unit of AIDWA, described the credit situation in her State. The AIDWA unit in Orissa surveyed 600 SHGs in 12 districts of the State, including those that have taken government loans; those that have taken loans from government and MFIs; and those that borrowed only from MFIs. The last category accounts for 70 per cent of the SHGs surveyed.</font><br /><br /><font >The survey found that MFIs had penetrated deep into villages and towns. While on paper, the rate of interest is a flat 10 per cent, the interest charged is on the entire principal through the repayment period, with cuts made from the principal amount under several heads &mdash; such as processing fee, bank charges, agreement charges, membership charges and so on. &ldquo;The compounded interest is never less than 52 per cent, and we found that on the last 10 rupee instalment, the interest is 525 percent!&rdquo;</font><br /><br /><font >Measures of recovery are harsh. Agents operate through the head of the SHG the debtor belongs to, and take away her every possession. &ldquo;Bilashini Behra from Bhubaneshwar took loans from three MFIs, each successive one to pay the previous. She committed suicide because she could ultimately not repay,&rdquo; said Ms. Praharaj.</font><br /><br /><font >&ldquo;The Central government, with the view that this can attract Foreign Direct Investment, has moved a Bill on MFIs,&rdquo; said Rajya Sabha MP Brinda Karat. &ldquo;There is no cap on interest, so that women's savings can be taken control of, destroying the autonomy of SHGs. In fact, when I met the Andhra Pradesh Chief Minister with an AIDWA delegation, he categorically told me that he had instructions from the Centre that there should be no cap on interest rates.&rdquo;</font><br /><br /></div>               </font>
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<font face="arial,helvetica,sans-serif" size="3">Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women's Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an iron grip on poor women debtors in several States of the country.</font><br />
<br />
<font face="arial,helvetica,sans-serif" size="3">The resolution drew attention to the &ldquo;spate of suicides as a result of the harassment and strong-arm tactics employed by commercial and profit-oriented corporate MFIs for loan recovery.&rdquo; Taking advantage of the failure of banks to meet the credit needs of the poor, &ldquo;This new breed of moneylenders is luring women to form Self Help Groups, and then charging them exorbitant rates of interest &mdash; as high as 48-60 percent&hellip;Whatever little collectivism has been generated by the SHGs has been systematically destroyed in the process.&rdquo;</font><br />
<br />
<font face="arial,helvetica,sans-serif" size="3">It highlights the situation in Andhra Pradesh, where &ldquo;32 MFIs are reported to have given loans worth Rs. 25,000 crore to 40 per cent of the poor women in the State. Unable to meet their forcible demands for loan recovery, more than a hundred people have committed suicide in the last three months.&rdquo; The ordinance promulgated by the Government of Andhra Pradesh is an eye-wash as it does not put a cap on the interest rates that MFIs can charge.</font><br />
<br />
<font face="arial,helvetica,sans-serif" size="3">The resolution calls for an immediate Central law to cap interest rates charged by MFIs, and to regulate their operations; to file criminal cases against MFIs engaged in extortionist practices; to cap interest rates from banks to SHGs at four per cent and cap loans given by MFIs to not more than two per cent above the banks interest rates to MFIs; and to expand cheap credit facilities through direct banking to SHGs.</font><br />
<br />
<font face="arial,helvetica,sans-serif" size="3">&ldquo;From the village money-lender to the corporate money-lender&rdquo; &mdash; is how Taposhi Praharaj, Vice-President of the Orissa unit of AIDWA, described the credit situation in her State. The AIDWA unit in Orissa surveyed 600 SHGs in 12 districts of the State, including those that have taken government loans; those that have taken loans from government and MFIs; and those that borrowed only from MFIs. The last category accounts for 70 per cent of the SHGs surveyed.</font><br />
<br />
<font face="arial,helvetica,sans-serif" size="3">The survey found that MFIs had penetrated deep into villages and towns. While on paper, the rate of interest is a flat 10 per cent, the interest charged is on the entire principal through the repayment period, with cuts made from the principal amount under several heads &mdash; such as processing fee, bank charges, agreement charges, membership charges and so on. &ldquo;The compounded interest is never less than 52 per cent, and we found that on the last 10 rupee instalment, the interest is 525 percent!&rdquo;</font><br />
<br />
<font face="arial,helvetica,sans-serif" size="3">Measures of recovery are harsh. Agents operate through the head of the SHG the debtor belongs to, and take away her every possession. &ldquo;Bilashini Behra from Bhubaneshwar took loans from three MFIs, each successive one to pay the previous. She committed suicide because she could ultimately not repay,&rdquo; said Ms. Praharaj.</font><br />
<br />
<font face="arial,helvetica,sans-serif" size="3">&ldquo;The Central government, with the view that this can attract Foreign Direct Investment, has moved a Bill on MFIs,&rdquo; said Rajya Sabha MP Brinda Karat. &ldquo;There is no cap on interest, so that women's savings can be taken control of, destroying the autonomy of SHGs. In fact, when I met the Andhra Pradesh Chief Minister with an AIDWA delegation, he categorically told me that he had instructions from the Centre that there should be no cap on interest rates.&rdquo;</font><br />
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Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women's Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an...',
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<div align="justify">
<font face="arial,helvetica,sans-serif" size="3">Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women's Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an iron grip on poor women debtors in several States of the country.</font><br />
<br />
<font face="arial,helvetica,sans-serif" size="3">The resolution drew attention to the &ldquo;spate of suicides as a result of the harassment and strong-arm tactics employed by commercial and profit-oriented corporate MFIs for loan recovery.&rdquo; Taking advantage of the failure of banks to meet the credit needs of the poor, &ldquo;This new breed of moneylenders is luring women to form Self Help Groups, and then charging them exorbitant rates of interest &mdash; as high as 48-60 percent&hellip;Whatever little collectivism has been generated by the SHGs has been systematically destroyed in the process.&rdquo;</font><br />
<br />
<font face="arial,helvetica,sans-serif" size="3">It highlights the situation in Andhra Pradesh, where &ldquo;32 MFIs are reported to have given loans worth Rs. 25,000 crore to 40 per cent of the poor women in the State. Unable to meet their forcible demands for loan recovery, more than a hundred people have committed suicide in the last three months.&rdquo; The ordinance promulgated by the Government of Andhra Pradesh is an eye-wash as it does not put a cap on the interest rates that MFIs can charge.</font><br />
<br />
<font face="arial,helvetica,sans-serif" size="3">The resolution calls for an immediate Central law to cap interest rates charged by MFIs, and to regulate their operations; to file criminal cases against MFIs engaged in extortionist practices; to cap interest rates from banks to SHGs at four per cent and cap loans given by MFIs to not more than two per cent above the banks interest rates to MFIs; and to expand cheap credit facilities through direct banking to SHGs.</font><br />
<br />
<font face="arial,helvetica,sans-serif" size="3">&ldquo;From the village money-lender to the corporate money-lender&rdquo; &mdash; is how Taposhi Praharaj, Vice-President of the Orissa unit of AIDWA, described the credit situation in her State. The AIDWA unit in Orissa surveyed 600 SHGs in 12 districts of the State, including those that have taken government loans; those that have taken loans from government and MFIs; and those that borrowed only from MFIs. The last category accounts for 70 per cent of the SHGs surveyed.</font><br />
<br />
<font face="arial,helvetica,sans-serif" size="3">The survey found that MFIs had penetrated deep into villages and towns. While on paper, the rate of interest is a flat 10 per cent, the interest charged is on the entire principal through the repayment period, with cuts made from the principal amount under several heads &mdash; such as processing fee, bank charges, agreement charges, membership charges and so on. &ldquo;The compounded interest is never less than 52 per cent, and we found that on the last 10 rupee instalment, the interest is 525 percent!&rdquo;</font><br />
<br />
<font face="arial,helvetica,sans-serif" size="3">Measures of recovery are harsh. Agents operate through the head of the SHG the debtor belongs to, and take away her every possession. &ldquo;Bilashini Behra from Bhubaneshwar took loans from three MFIs, each successive one to pay the previous. She committed suicide because she could ultimately not repay,&rdquo; said Ms. Praharaj.</font><br />
<br />
<font face="arial,helvetica,sans-serif" size="3">&ldquo;The Central government, with the view that this can attract Foreign Direct Investment, has moved a Bill on MFIs,&rdquo; said Rajya Sabha MP Brinda Karat. &ldquo;There is no cap on interest, so that women's savings can be taken control of, destroying the autonomy of SHGs. In fact, when I met the Andhra Pradesh Chief Minister with an AIDWA delegation, he categorically told me that he had instructions from the Centre that there should be no cap on interest rates.&rdquo;</font><br />
<br />
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Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women's Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an...'
$disp = '<font ><br /></font><div align="justify"><font >Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women's Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an iron grip on poor women debtors in several States of the country.</font><br /><br /><font >The resolution drew attention to the &ldquo;spate of suicides as a result of the harassment and strong-arm tactics employed by commercial and profit-oriented corporate MFIs for loan recovery.&rdquo; Taking advantage of the failure of banks to meet the credit needs of the poor, &ldquo;This new breed of moneylenders is luring women to form Self Help Groups, and then charging them exorbitant rates of interest &mdash; as high as 48-60 percent&hellip;Whatever little collectivism has been generated by the SHGs has been systematically destroyed in the process.&rdquo;</font><br /><br /><font >It highlights the situation in Andhra Pradesh, where &ldquo;32 MFIs are reported to have given loans worth Rs. 25,000 crore to 40 per cent of the poor women in the State. Unable to meet their forcible demands for loan recovery, more than a hundred people have committed suicide in the last three months.&rdquo; The ordinance promulgated by the Government of Andhra Pradesh is an eye-wash as it does not put a cap on the interest rates that MFIs can charge.</font><br /><br /><font >The resolution calls for an immediate Central law to cap interest rates charged by MFIs, and to regulate their operations; to file criminal cases against MFIs engaged in extortionist practices; to cap interest rates from banks to SHGs at four per cent and cap loans given by MFIs to not more than two per cent above the banks interest rates to MFIs; and to expand cheap credit facilities through direct banking to SHGs.</font><br /><br /><font >&ldquo;From the village money-lender to the corporate money-lender&rdquo; &mdash; is how Taposhi Praharaj, Vice-President of the Orissa unit of AIDWA, described the credit situation in her State. The AIDWA unit in Orissa surveyed 600 SHGs in 12 districts of the State, including those that have taken government loans; those that have taken loans from government and MFIs; and those that borrowed only from MFIs. The last category accounts for 70 per cent of the SHGs surveyed.</font><br /><br /><font >The survey found that MFIs had penetrated deep into villages and towns. While on paper, the rate of interest is a flat 10 per cent, the interest charged is on the entire principal through the repayment period, with cuts made from the principal amount under several heads &mdash; such as processing fee, bank charges, agreement charges, membership charges and so on. &ldquo;The compounded interest is never less than 52 per cent, and we found that on the last 10 rupee instalment, the interest is 525 percent!&rdquo;</font><br /><br /><font >Measures of recovery are harsh. Agents operate through the head of the SHG the debtor belongs to, and take away her every possession. &ldquo;Bilashini Behra from Bhubaneshwar took loans from three MFIs, each successive one to pay the previous. She committed suicide because she could ultimately not repay,&rdquo; said Ms. Praharaj.</font><br /><br /><font >&ldquo;The Central government, with the view that this can attract Foreign Direct Investment, has moved a Bill on MFIs,&rdquo; said Rajya Sabha MP Brinda Karat. &ldquo;There is no cap on interest, so that women's savings can be taken control of, destroying the autonomy of SHGs. In fact, when I met the Andhra Pradesh Chief Minister with an AIDWA delegation, he categorically told me that he had instructions from the Centre that there should be no cap on interest rates.&rdquo;</font><br /><br /></div>'
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Need to regulate microfinance institutions: AIDWA by Parvathi Menon

Among the several resolutions passed on Thursday by the 9th conference of the All India Democratic Women's Association (AIDWA) in Kanpur, one of the most important ones was on the need to regulate microfinance institutions (MFIs), which are exercising an iron grip on poor women debtors in several States of the country. The resolution drew attention to the “spate of suicides as a result of the harassment and strong-arm tactics employed by commercial and profit-oriented corporate MFIs for loan recovery.” Taking advantage of the failure of banks to meet the credit needs of the poor, “This new breed of moneylenders is luring women to form Self Help Groups, and then charging them exorbitant rates of interest — as high as 48-60 percent…Whatever little collectivism has been generated by the SHGs has been systematically destroyed in the process.” It highlights the situation in Andhra Pradesh, where “32 MFIs are reported to have given loans worth Rs. 25,000 crore to 40 per cent of the poor women in the State. Unable to meet their forcible demands for loan recovery, more than a hundred people have committed suicide in the last three months.” The ordinance promulgated by the Government of Andhra Pradesh is an eye-wash as it does not put a cap on the interest rates that MFIs can charge. The resolution calls for an immediate Central law to cap interest rates charged by MFIs, and to regulate their operations; to file criminal cases against MFIs engaged in extortionist practices; to cap interest rates from banks to SHGs at four per cent and cap loans given by MFIs to not more than two per cent above the banks interest rates to MFIs; and to expand cheap credit facilities through direct banking to SHGs. “From the village money-lender to the corporate money-lender” — is how Taposhi Praharaj, Vice-President of the Orissa unit of AIDWA, described the credit situation in her State. The AIDWA unit in Orissa surveyed 600 SHGs in 12 districts of the State, including those that have taken government loans; those that have taken loans from government and MFIs; and those that borrowed only from MFIs. The last category accounts for 70 per cent of the SHGs surveyed. The survey found that MFIs had penetrated deep into villages and towns. While on paper, the rate of interest is a flat 10 per cent, the interest charged is on the entire principal through the repayment period, with cuts made from the principal amount under several heads — such as processing fee, bank charges, agreement charges, membership charges and so on. “The compounded interest is never less than 52 per cent, and we found that on the last 10 rupee instalment, the interest is 525 percent!” Measures of recovery are harsh. Agents operate through the head of the SHG the debtor belongs to, and take away her every possession. “Bilashini Behra from Bhubaneshwar took loans from three MFIs, each successive one to pay the previous. She committed suicide because she could ultimately not repay,” said Ms. Praharaj. “The Central government, with the view that this can attract Foreign Direct Investment, has moved a Bill on MFIs,” said Rajya Sabha MP Brinda Karat. “There is no cap on interest, so that women's savings can be taken control of, destroying the autonomy of SHGs. In fact, when I met the Andhra Pradesh Chief Minister with an AIDWA delegation, he categorically told me that he had instructions from the Centre that there should be no cap on interest rates.”