The loan recast proposal of Sharada’s Women’s Association for Weaker Section (SWAWS) Credit Corporation, an Indian microfinance institution (MFI), has been admitted into the 2012 corporate debt restructuring (CDR) cell, which was designed by the reserve bank of India to help MFIs carry out restructuring plans. In order for the proposal to be admitted, over 60 percent of creditors by number and over 75 percent of lenders by value had to approve the package. Lenders of the package include Indian financial services companies Punjab National Bank (PNB) and Housing Development Finance Corporation (HDFC) Bank
As part of the proposal, the banks have agreed to convert 30 percent of their loans into shares. The interest rate and repayment tenure of the loans will be restructured later this year. The increase in loan funding originally requested by SWAWS as part of the package will not be included. K Rahul, chief financial officer of SWAWS, said the refinancing package “was needed to sustain our operations and service the restructured loan.”
As of 2010, SWAWS reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 28.3 million, a gross loan portfolio of USD 25.6 million, a gross loan portfolio of USD 20.1 million, and 134,655 active borrowers.
By Brett Cohen, Research Associate.
About Sharada’s Women’s Association for Weaker Section (SWAWS)
SWAWS, registered in 1999, aims to “improve the quality of life of clients through provision of responsive and efficient financial services as per international best practices and transparency, while maximizing stake holder’s value.” As of 2010, SWAWS reported to the US-based nonprofit Microfinance Information Exchange (MIX) total assets of USD 25.6 million, a gross loan portfolio of USD 20.1 million, and 134,655 active borrowers.
Sources and Additional Resources
Business-standard.com story: “SWAWS second microfinance firm to go into CDR in ’12”
http://www.business-standard.com/india/news/swaws-second-microfinance-fi…
Microcapital.org story, April 16, 2011: “MICROCAPITAL BRIEF: Cresa Microfinance, Sharada’s Women’s Association for Weaker Section (SWAWS) Microfinance of India Face Possible Bankruptcy”
https://www.microcapital.org/microcapital-brief-cresa-microfinance-sharad
MicroCapital.org story, January 17, 2012: “MICROCAPITAL BRIEF: Preferring Sector-Wide Solution, Reserve Bank of India Refuses to Classify Restructured Loans as Performing Assets for Microfinance Institutions BASIX, Sharada’s Women’s Association for Weaker Section (SWAWS)
https://www.microcapital.org/microcapital-brief-preferring-sector-wide-so…
MicroCapital Universe Profile: Sharada’s Women’s Association for Weaker Section
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Sha…
Browse the MicroCapital Universe and add your entry to the wiki at https://www.microcapital.org/microfinanceuniverse/tiki-index.php
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