On November 27, 2010 – Dainik Jagran, the largest selling newspaper in India (Hindi Language) carried an interesting report that stated that the Ministry of Finance had recently held a discussion on microcredit in which a document detailing the profits earned by the MFIs was placed before the members for deliberation.
An analysis of the profits reported by 13 major non banking finance companies engaged in micro finance has revealed that the profits these firms accumulated through their earnings from interest on loans had swelled from Rs 677.3 crore in 2007-08 to Rs 3776.93 crore in 2009-10. In other words, their profits had multiplied by 5.5 times over a period of two years.
The profits reported by some of the microfinance NBFC’s as given by Dainik Jagran has been reproduced below.
MFIs Interest Profit (In Crores of Rupees)
Microfinance Company 2007-08 2009-10
SKS Microfinance 170.1 958.92
Bandhan 6.56 222.11
BSS 7.03 155.38
Share Microfinance 113.08 475.27
Grameen FS 82.65 327.35
Spandana Spoorthy 127.45 724.09
Ujjivan 36.37 372.89
(Note: Rs 1 crore=Rs 10 million)
It is not known as to what conclusions the Finance Ministry arrived at on the basis of this information but it very likely that it will have an influence on future microfinance policy decisions that will be announced by the Central Government of India.
Source : Dainik Jagran and Mr Devinder Sharma