SKS Microfinance, an Indian microfinance institution (MFI), has announced plans to offer an endowment life insurance plan to its borrowers. The plan guarantees an undisclosed sum at the end of the term or upon the death of the policyholder. This stands in contrast to non-endowment life insurance plans, which only pay out upon the death of the policyholder.
SKS had offered an endowment life insurance plan until 2009, when it could no longer keep up with the growing demand for the service. An unidentified senior executive of SKS was quoted as saying “There was huge demand and we facilitated sale of around 2.8 million insurance policies in 14 months. But our internal systems were not capable of handling these volumes and we discontinued the business.” The new policies will be backed by Life Insurance Corporation of India, SBI Life and ICICI Prudential Life. The timeline of the plan’s introduction has not yet been disclosed.
SKS Microfinance is a for-profit microfinance institution (MFI) that was launched in 1998. As of December 31, 2011, SKS reports total assets of USD 389.3, a gross loan portfolio of USD 341.1 million, approximately 4,303,000 borrowers, return on assets (ROA) of -66.10 percent and return on equity (ROE) of -152.48 percent.
By Brett Cohen, Research Associate
About SKS Microfinance
SKS Microfinance is a for-profit microfinance institution (MFI) that was launched in 1998. It has recently diversified into offering gold loans, funeral assistance and loans to small stores. SKS converted into a public limited company in May 2009 and launched an initial public offering on July 28, 2010. Its equity investors include Quantum Hedge Fund, Sequoia Capital, Vinod Khosla, Small Industries Development Bank of India, Bajaj Allianz, Yatish Trading, Kismet Capital, Sandstone Capital, Silicon Valley Bank and Unitus. SKS currently trades on the Bombay Stock Exchange. As of December 31, 2011, SKS reports total assets of USD 389.3, a gross loan portfolio of USD 341.1 million, approximately 4,303,000 borrowers, return on assets (ROA) of -66.10 percent and return on equity (ROE) of -152.48 percent.
Sources and Additional Resources
Business-standard.com story, “SKS to relaunch life cover for micro borrowers”
http://business-standard.com/india/news/sks-to-relaunch-life-cover-for-m…
MicroCapital.org story, May 27, 2012 “MICROCAPITAL BRIEF: India’s Insurance Regulatory and Development Authority (IRDA) Finds “Massive Problems” with Practices of SKS Microfinance”
https://www.microcapital.org/microcapital-brief-indias-insurance-regulato…
MicroCapital.org story, May 11, 2012: “MICROCAPITAL BRIEF: SKS Microfinance to Cut 1,200 Jobs, Close 78 Branches in Andhra Pradesh, India”
https://www.microcapital.org/microcapital-brief-sks-microfinance-to-cut-1…
MicroCapital Universe Profile: SKS Microfinance
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=SKS…
Browse the MicroCapital Universe and add your entry to the wiki at: https://www.microcapital.org/microfinanceuniverse/
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