by Nicole Boyd -

MICROCAPITAL BRIEF: Government of India’s Andhra Pradesh Moves to Challenge Supreme Court Interim Order as SKS Microfinance Resumes Operations in the State

As Indian microfinance institution (MFI) SKS Microfinance prepares to resume operations in the Indian state of Andhra Pradesh under a recent Supreme Court order, the Andhra Pradesh state government is moving to challenge the Supreme Court’s decision.

by Nicole Boyd -

MICROCAPITAL BRIEF: Supreme Court of India Issues Interim Order Loosening Restrictions on SKS Microfinance in Andhra Pradesh

The Indian Supreme Court has issued an interim order allowing Indian microfinance institution (MFI) SKS Microfinance to operate in the state of Andhra Pradesh without securing no-objection certificates from the state government.

by Natalie Baer -

MICROFINANCE PUBLICATION ROUND-UP: Indian Microfinance, Treating Colombian Clients with Respect, and Expanding Microinsurance

“Indian Microfinance: Looking Beyond the AP Act and its Devastating Impact on the Poor;” published by Legatum Ventures; March 2012; 17 pages; available at: http://www.legatumventures.com/

by Nisha Koul -

MICROCAPITAL BRIEF: Indian Microfinance Institutions Shift from Lending Mostly to Women Towards Relatively Gender-Balanced Portfolio, Reports Elena Bridgers in Stanford Social Innovation Review

Elena Bridgers, a social researcher based in France, recently authored an article on the website of the US-based Stanford Social Innovation Review exploring the shift of microfinance institutions (MFIs) in India from a primarily “female client base” to a more “gender-balanced portfolio” [1].

by Kristha Abores -

MICROCAPITAL BRIEF: Indian Microfinance Sector Expected to Decline by 20 to 40 Percent During Fiscal Year Ending March 2012

Data from India’s 39-member Microfinance Institutions Network (MFIN) for the first five months of fiscal year 2011-2012 indicate a decline in the industry’s loan portfolio.

by Carol Kim -

MICROCAPITAL BRIEF: Microfinance Institutions in India Continue to Struggle for Funding After Loan Recast, Adoption of Malegam Proposals

Microfinance institutions (MFIs) in India reportedly continue to struggle after recasting of a significant portion of their wholesale debt and the adoption by the Reserve Bank of India (RBI), the country’s central banking authority, of many of the Malegam Committee’s proposals on regulating the sector.

by Jacqueline Foelster -

MICROCAPITAL BRIEF: Confusion Continues Over Regulation of Microfinance Institutions (MFIs) in India, State of Andhra Pradesh May Adjust Law to Reconcile With Federal Rules

The Business Standard, an Indian financial newspaper, recently reported that the regulations recently issued for the microfinance sector by the Reserve Bank of India (RBI), India’s central banking authority, and the Regulation of Microlending act issued by the government of the state of Andhra Pradesh in 2010 are creating confusion over the regulatory jurisdiction of each entity.

by Matthew Castner -

MICROCAPITAL BRIEF: Elevar and SVB make USD 8.6m Equity Investment In Indian Microfinance Institution Vistaar Livelihood Finance

Elevar Equity Advisors and SVB India Capital Partners have teamed to make an INR 400 million (USD 8.64 million) equity investment in Vistaar Livelihood Finance, an Indian microfinance institution catering to non-agricultural female entrepreneurs. While their stake in Vistaar was not disclosed, Brahmanand Hegde, CEO of Vistaar, stated that the two companies had bought a “substantial minority” in the company.

by Christine Chang -

MICROCAPITAL BRIEF: Elevar Equity, a Bangalore-based Private Equity Fund, Raises $70m for Microfinance-focused Fund for Investments in India, Mexico, the Philippines and Peru

Elevar Equity Advisors Private Limited (Elevar), a Bangalore-based private equity fund, has raised a USD 70 million fund that will invest in microfinance and other services in India, Mexico, the Philippines and Peru.

by Christopher Maggio -

MICROCAPITAL BRIEF: Indian Microfinance Technology Provider ‘Financial Information Networks and Operation’ (FINO) Receives $15m in Equity Capital from HSBC Private Equity, Intel Capital, and the International Finance Corporation (IFC)

Financial Information Networks and Operation (FINO), an Indian company that provides technological products to microfinance institutions (MFIs), banks, and insurance companies, has received a INR 70 crore infusion, the equivalent of over USD 15 million, in private equity funding from HSBC Private Equity, the equity investment arm of the Hong Kong bank; Intel Capital, the investment arm of the American semiconductor producer; and the International Finance Corporation (IFC), the investment arm of the World Bank [1,2,3,4,5]. Details of how much was invested by each organization were not made available. Rishi Gupta, Chief Financial Officer of FINO, has stated the capital will be used to help “meet the demand” for various products including servers and biometric cards that store transaction records [1]. The transaction was advised by Avendus Capital, an investment bank based in India [1,6]. In an apparently separate transaction, HSBC and Intel have purchased the stake of FINO formerly owned by Legatum, an investment group based in Dubai [1,7]. Legatum originally bought this stake in 2007 for USD 4.5 million, as reported by MicroCapital [1,8]. According to Mr. Gupta, HSBC and Intel purchased the stake for a “far higher,” though unspecified, price [1]. The percentage stake that HSBC and Intel now have is also unspecified.

by Chinq Yee Chong -

MICROCAPITAL.ORG STORY: Omidyar Network Establishes Entity In India Called Omidyar Network India Advisors With A View To Forming Closer Ties With India-Based Portfolio Organizations

It was recently reported on the Reuters news wire [1] that Omidyar
Network (Omidyar) [2], a social investment firm, has established a
new entity in India called Omidyar Network India Advisors which will be led by Mr Jayant Sinha. The Indian office will enable Omidyar to increase investments and partner more closely with India-based portfolio organizations. Mr Sinha expects Omidyar’s involvement in India to ‘catalyze economic opportunity and social impact’ in the country through ‘market-based approaches that have the potential to improve millions of lives’.

by Laura Anderson -

MICROCAPITAL STORY: Share Microfin Seeks to Raise USD 50 Million From International Finance Corporation (IFC) and Others

SHARE Microfin, a microfinance institution (MFI) based in Hyderabad, India, has announced that it intends to raise USD 50 million in equity funding.   According to the press release on VCCircle, the International Finance Corporation (IFC) is considering investing, and the MFI is currently in talks with other investors.  If the transaction proceeds it will be one of the biggest Indian microfinance transactions after SKS Microfinance‘s USD 75 million deal in November last year.  To read a MicroCapital story about that deal, click here.  With the funding, SHARE will expand in states such as Chhattisgarh, Uttar Pradesh, Madhya Pradesh, Uttranchal, and West Bengal.  No other information regarding the deal or potential investors was available at the time of this release.

by Yanni Hao -

MICROFINANCE PAPER WRAP-UP: Shedding Light on Microfinance Equity Valuation – Past and Present, by Nicholas P. O’Donohoe, Frederic Rozeira de Mariz, Elizabeth Littlefield, Xavier Reille, and Christoph Kneiding, Part I of II

The Consultative Group to Assist the Poor (CGAP), a policy and research center housed at the World Bank dedicated to advancing financial access to the world’s underprivileged, released a path breaking report in February 2009 entitled, “Shedding Light on Microfinance Equity Valuation – Past and Present,” produced with limited analytical support from banking firm JPMorgan Chase & Co. The white paper is notable in providing an empirically grounded analysis of how financial valuation methods are actually applied by external actors to MFIs and other lending institutions with poverty alleviation goals. This is made possible by CGAP’s collection of information on 144 private equity transactions, the largest such dataset gathered to date, as well as information on 10 MFIs and other low income focused lenders that have raised funds through the issuance of securities. The original report is available at: http://www2.cgap.org/gm/document-1.9.9021/OP14v3.pdf