AP assembly OKs microfinance bill, says government spokesman

Andhra Pradesh assembly has approved a legislation to regulate the microfinance sector by ratifying an earlier ordinance that has curbed operations by the lenders to the poor, a government spokesman said today.

Andhra Pradesh assembly has approved a legislation to regulate the microfinance sector by ratifying an earlier ordinance that has curbed operations by the lenders to the poor, a government spokesman said on Wednesday.

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The state assembly has passed the bill, which will now be send to the upper house of lawmakers and a final decision is expected later on Wednesday or Thursday, the spokesman told Reuters.

The Andhra Pradesh ordinance took effect in October, while the state assembly was not in session, in response to complaints over high interest rates, aggressive loan recovery practices and overextended borrowers.

The ordinance has severely curtailed the activities of microfinance lenders in the state, which had been their largest single market in India.