The Andhra Pradesh High Court today refused to grant a stay on the state government’s order that brings in greater regulation of Microfinance Institutions. It was hearing a plea by microfinance institutions challenging a government ordinance which regulates the working of microfinance companies.
The High Court further added that the state government has the right to bring checks on microfinance institutions found violating norms and that the microfinance institutions would be required to register within a week. The High Court has also allowed to microfinance institutions to collect repayments and directed them to apply for registration within seven days.The current ruling permits MFI’s to carry on their lending and recovery operations till they get registered for upto one week. More details of the High Court verdict are awaited.