SKS Microfinance has problems of recovery now in parts of West Bengal and Gujarat after slipping into crisis in Andhra Pradesh in October last year due to high interest rates on its lending and its alleged coercive practices in loan recovery.
Managing Director and Chief Executive Officer M. R. Rao said at a press conference here on Wednesday that the company hoped to return to profitability by 2012-13 and achieve 3 per cent return on assets by 2013-14 by expanding non-Andhra Pradesh portfolio and increasing non-microfinance business such as gold loans, funding to grocery stores and mobile phone finance. Chief Financial Officer Dilli Raj said that the company had some recovery problems in five districts in West Bengal and three in Gujarat due to local, process and commission agents-related issues.
It has an outstanding credit of Rs.822 crore in the State.
“We have time up to October 2012 to write-off the net residual risk of Rs.342 crore,” Mr. Raj said.
SKS Microfinance posted a Rs.385-crore loss in the second quarter of 2011-12, he noted.
