Seven Indian microfinance institutions in Forbes' 50 list
Seven Indian microfinance institutions, the highest for a country, feature in the first ever list of world's top 50 MFIs compiled by Forbes magazine.world Updated: Dec 26, 2007 23:08 IST
Seven Indian microfinance institutions (MFIs), the highest for a country, feature in the first ever list of world's top 50 MFIs compiled by Forbes magazine.
Bangalore-based Bandhan is ranked at the second position, while the top slot is taken by Bangladesh's ASA.
Bangladesh's Grameen Bank, which along with its founder Mohammed Yunus was awarded Nobel Peace Prize for 2006, comes lower down at 17th position. But the country has a total of seven of its MFIs on the list.
Other Indian MFIs on the US business magazine's list are Microcredit Foundation of India (ranked 13th) and Saadhana Microfin Society (15th), Grameen Koota (19th), Sharada's Women's Association for Weaker Section (23rd), SKS Microfinance Private Ltd. (44th) and Asmitha Microfin Ltd (29th).
Grameen Koota and SKS work on the model adopted by Grameen Bank. ASA website says 19 lesser known Indian MFIs have been receiving basic training and consultancy services from it.
Forbes picked the top 50 from 641 microcredit providers around the world after sifting through data available with the Microfinance Information Exchange and the analysis from rating firms Micro-Credit Ratings International Limited and MicroRate. There are upward of 12,000 microlending institutions in the world today.
Forbes rankings were based on six key variables-gross loan portfolio, operating expense, operating expenses divided by the average number of active borrowers as a percentage of gross national income per capita, the outstanding balance of loans overdue by more than 30 days as a per cent of gross loan portfolio, return on assets, and return on equity.
The magazine underlined the increasing importance of microfinance, which is "raising the provocative notion that even philanthropy aimed at alleviating poverty can be profitable to institutional and individual investors."
"Billionaires, global leaders and Nobel Prize recipients are hailing these direct loans to uncollateralised would-be entrepreneurs as a way to lift them out of poverty while creating self-sustaining businesses," it noted.
The magazine said microfinance funding from private investors more than tripled to $2 billion in 2006.