The SKS Microfinance limited has announced one per cent reduction in its MFI interest rate, charged to borrowers, from 20.75 per cent for all future disbursals
With this, the company has become the first micro finance institution to charge a sub-20 per cent interest rate on its core Income Generating loans (IGl), which are unsecured micro loans.
Interest rate of 19.75 per cent is the lowest rate charged by any private sector MFI in the world. This is the fourth interest rate reduction, aggregating 4.8 per cent, announced by the Company since October 2014. The Company has been charging the lowest interest rate among Indian MFIs since July 2015
For Odisha, the company’s membership has increased from 6.9 lakh to 7.4 lakh between March 31 and September 30 this year. In Odisha , the company operates 149 branches across 27 districts, including Angul, Balangir, Baleswar, Cuttack, Dhenkanal, Gajapati, Jajpur, Keonjhar, Khordha, Mayurbhanj, Puri, Sambalpur, Sonepur and Sundargarh.
The State accounts for 17.3 per cent of the company’s `5,462 crore portfolio outside the States of Andhra Pradesh and Telangana as ofSeptember 30, said a company official.
The reductions are consistent with the company’s policy of passing on the cost advantages accruing from reduction in the cost of borrowing and economies of scale to its borrowers, the official added.
Notably, the SKS Microfinance is among the largest microfinance companies in India having presence in 18 States covering 1,00,000 villages.