Several microfinance institutions (MFIs) in the country have raised capital during 2012 because of expectation of better growth prospects in the coming years.
For example, Grameen Capital India, a social-investment bank, says $144 m of equity has been injected into microfinance groups in the past 12 months, more than double the amount in the preceding year.
Another MFI Equitas raised $18 mn from the International Finance Corporation, a multilateral lender. Equitas is a mid-sized group in the southern state of Tamil Nadu.
Last year, SKS Microfinance raised $47.5 mn by issuing shares. The loan book of SKS now stands around $325 mn.
Some industry observers feel that the industry is on the revival path after the crisis in Andhra Pradesh during 2010. According to the Microfinance Institutions Network (MFIN), microlendersÂ’ loan books rose in value by 33 percent year on year in Jul-Sep 2012 outside Andhra Pradesh.
Southern states and the eastern state of West Bengal are new hotspots. Bandhan, a no-frills company based in West Bengal, now has over 4 mn borrowers and the largest microfinance loan book in the country. Analysts say the sectorÂ’s outstanding loans are now worth $2 billion-3 billion, compared with a peak of around $5 billion during the boom.
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