Microfinance clients driven to suicide

Microfinance clients driven to suicide

2010-10-20 18:21:09
A Church activist has voiced concern over increasing suicide cases among clients of micro-finance institutions (MFI) in a southern Indian state. “The state government must ensure these institutions register with proper authorities and check their payback policies,” said Montfort Brother Varghese Theckenath, director of Montfort Social Institute in Hyderabad. The Andhra Pradesh government issued an ordinance on Oct. 14 to regulate these institutions after it suspected that alleged harassment by their recovery agents had caused more than 20 suicide cases in two weeks. Brother Theckenath adds that MFIs are becoming popular because the government has failed to provide credit to the poor. According to him, most MFIs are not registered and charge “very high interest rates.” State Rural Development Minister Vatti Vasanth Kumar told reporters that the government would ask banks to take over the MFI loans. On Oct. 19, the Micro Finance Institutions Network demanded a judicial probe into the suicide cases. “We would cooperate with the government probe and boycott those found guilty,” Network President Vijay Mahajan said, criticizing the ordinance as a hasty act issued without proper investigation. Reported report Asian farmers tackle climate change issues IB11647.1624
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