Investing in the poor in India

The success of India’s first microfinance IPO opens a new frontier for investors in micro financial services.

The overwhelming success of SKS Microfinance’s $342 million initial public offering marks a turning point not just for India’s largest micro lender but for the most dynamic sector of the country’s financial services industry. Although micro-credit organisations aren’t strictly banks in India, for-profit microfinance institutions or MFIs are barred from accepting retail deposits, they operate like banks in that they borrow money and lend it at a significant spread to the poor.

According to Intellecap, a Hyderabad-based consulting firm specialising in low-income markets, between 2004 and 2009 Indian MFIs recorded spectacular growth rates. Every year, on average, they have increased their client base by 91% and their...

¬ Haymarket Media Limited. All rights reserved.

FinanceAsia has updated its subscription model.

Registered readers now have the opportunity to read 5 articles from our award-winning website for free.

To obtain unlimited access to our award-winning exclusive news and analysis, we offer subscription packages, including single user, team (2-10 users), or office-wide licences.

To help you and your colleagues access our proprietary content, please contact us at subscriptions@financeasia.com, or +(852) 2122 5222

Article limit is reached.

Hello! You have used up all of your free articles on FinanceAsia.

To obtain unlimited access to our award-winning exclusive news and analysis, we offer subscription packages, including single user, team (2-10 users), or office-wide licences. To help you and your colleagues access our proprietary content, please contact us at subscriptions@financeasia.com, or +(852) 2122 5222