SKS Microfinance under IRDA scanner

Compounding its woes, SKS Microfinance has now come under insurance regulator IRDA’s scanner for violating norms in selling insurance policies to its borrowers.

Sources said the country’s only listed micro finance company SKS Microfinance is under the scanner of the Insurance Regulatory and Development Authority (IRDA) for charging higher commission on sale of insurance policies.

They said SKS had collected commissions higher than the 10 per cent permitted for an agent while selling policies.

There have also been reports that SKS had received cheques for death claims on its name. Under the normal practice, the cheque is issued in beneficiary’s name.

When contacted IRDA Chairman J. Hari Narayan told PTI, “We are still examining the records (of SKS). Investigation is going on.”

A spokesperson of SKS said, “The IRDA people came to examine records a month ago. But they have not issued any notice thereafter.”

For over a month now, SKS Microfinance is embroiled in a controversy for sacking of its chief executive Suresh Gurumani.

Adding to its woes, the Andhra Pradesh government issued an Ordinance on October 15 for conrolling the micro finance companies.