SKS Microfinance, which is at the centre of a controversy for having sacked its CEO last week, today said that while 17 of its borrowers were among those who have committed suicides but none of them was a defaulter.
"Of the total list, 17 people have had loans with SKS. But they have not committed suicides because of defaults," SKS Executive Chairman Vikram Akula told reporters here.
"I re-emphasise, in those suicides there were no defaults or loan arrears. There are other complicated issues (for suicides) on case-by-case basis. Even police have cleared that we are not involved in that," he added.
Akula also said that SKS would reduce its interest rate a couple of percent, from 26 per cent at present, if the government so desired.
Andhra Pradesh has been witnessing several suicides by rural people in the last 45 days following inability to repay loans from microfinance companies. Officials put the suicide figure at touched 30.
The situation prompted the state government to come out with an ordinance today to control loan recovery methods and other issues of microfinance lenders.
Akula was replying to a question on reports of growing suicides due to the alleged harassment by Micro Finance Institutions (MFIs) for loan collections.
As per the data available, the interest rate charged by MFIs ranges from 26-60 per cent.
To a query, Akula said if a borrower dies, the remaining loan amount is waived and whatever has been paid till then, will be returned to the family.
He said if the RBI or Finance Ministry asks SKS, the company will be is willing to reduce another two per cent in interest, from the present is 26 per cent.
"We are willing to reduce our rate of interest if RBI or Finance Ministry asks us to do so. We reduced rate of interest in the past, voluntarily. We are ready to lend at 24 per cent," Akula said.
When asked about the ordinance, he said, "As an NBFC, SKS is under the purview of RBI and is regulated by it. The state government will have to take up with RBI and Finance ministry as far as interest rates are concerned."
Akula said the profitability of the company will be maintained even after the interest drop.
"We also provide other products like insurance, housing loan... Additional revenue generated from them would offset the potential drop in the interest rates," he said.
SKS had triggered a controversy last week by sacking its CEO Suresh Gurumani and has been asked by market regulator Sebi to explain the reasons behind the move.
