India’s rapidly growing private microcredit industry faces imminent collapse as almost all borrowers in one of India’s largest states have stopped repaying their loans, egged on by politicians who accuse the industry of earning outsize profits on the backs of the poor. The crisis has been building for weeks, but has now reached a critical stage. Indian banks, which put up about 80 percent of the money that the companies...

The rural poor in Andhra Pradesh, a State showcased as a model for SHG-bank linkage, are caught in the vortex of microfinance. WITHIN a decade of their coming into operation, microfinance institutions (MFIs) have dealt a serious blow to the economy and the well-being of thousands of families in rural Andhra Pradesh. Harassment by their collection agents has allegedly driven at least 60 borrowers to death, and the number is...

More public private partnerships are needed to create opportunities for the rural population India might have created its mark in the services sector — especially in information technology — on the global map, but the development of the rural sector still has a lot of ground to cover. Discussing how to innovate rural entrepreneurship towards employment at the India Economic Summit, various speakers called for increased public private partnerships to create...

The poster boy of microfinance is now seeking some anonymity. In Andhra Pradesh, the epicentre of the worst crisis faced by microfinance in India, SKS Microfinance is playing down its identity and going into preservation mode. At its modest office in a residential colony in Warangal district, India’s largest microfinance company has taken down its board. At its head office in upmarket Begumpet in Hyderabad, it hung a cloth mesh...

Banks have disbursed nearly Rs 90,000 crore credit to farmers in the April-June quarter of this fiscal, the government said on Monday. The government has fixed the credit flow target during 2010-11 fiscal at Rs 3,75,000 crore. "Agriculture credit of Rs 89,687 crore has been disbursed to farmers across the country till June 2010 in the financial year 2010-11," an official statement said. The credit disbursement in 2009-10 was Rs 3,66,919 crore against...