Ujjivan Financial Services, an Indian microfinance institution, announces that it will reduce borrowing rates on new and renewal loans by 190-290 basis points. As a result, new business loans will cost 23 percent per annum and renewal loans will cost 22 percent per annum beginning in July 2010. As MicroCaptial reported on May 4, 2010, Bandhan Financial Services Private Limited, another Indian microfinance institution, reduced its annual rates on loans possibly triggering the Ujjivan reduction.
Ujjivan has been experiencing significant growth and reached profitability for the first time in fiscal 2010. “As we reach some scale, we have decided to pass on the benefits to our borrowers,” Ujjivan managing director Samit Ghosh reported. [1]
By Jennifer Shevock, Research Associate
About Ujjivan Financial Services:
Ujjivan Financial Services is an Indian microfinance instituation created under the guidance of Grameen Bank of Bangladesh to financially serve and empower poor working women in urban and semi-urban regions in India. Its disbursements through fiscal 2010 are USD 199 million and total assets are USD 72 million.
Sources and Additional Resources:
[1] “Another MFI Cuts Interest Rates” May 26, 2010. http://lite.epaper.timesofindia.com/mobile.aspx?article=yes&pageid=15&edlabel=ETKM&mydateHid=26-05-2010&pubname=&edname=&articleid=Ar01506&format=&publabel=ET
MICROCAPITAL BRIEF: “Bandhan Financial Services Private Limited, Microfinance Institution (MFI) Based in Kolkata, India, Decreases Interest Rate on Loans from 24 Percent to 19.1 Percent on a Reducing Balance” May 4, 2010. https://www.microcapital.org/microcapital-brief-bandhan-financial-services-private-limited-microfinance-institution-mfi-based-in-kolkata-india-decreases-interest-rate-on-loans-from-24-percent-to-191-percent-on-a-reducing-b/
MICROCAPITAL UNIVERSE: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Ujjivan
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