NEW DELHI The cabinet has approved a bill aimed to bring microlenders under the Reserve Bank of India's oversight, a minister, who declined to be named as the parliament is in session, said on Thursday.
The Microfinance Institutions (Development and Regulation) Bill needs parliament's approval to become a law.
Microlenders have been accused of aggressive lending and recovery practices and high interest rates, which attracted calls for regulation.
India's once-thriving microfinance sector was devastated by a crackdown more than a year ago by the government of Andhra Pradesh, which was the industry hub and largest market.
The state rules resulted in a drop off in loan collections and a drying up of funding for microlenders.
(Reporting by Nigam Prusty; editing by Malini Menon)
Trending On Reuters
India's biggest automaker by revenue reported a drop in quarterly net profit due to a spike in costs despite steady sales of its luxury Jaguar Land Rover unit and an increase in demand for its cars in its home market. Full Article
Shake-up in key Samsung assets to cement heir's grip as succession looms Full Article