‘Clear applications from MFIs within one week'

Responding to the High Court's order on the ordinance to regulate the microfinance institutions (MFI), the State government has directed its officials designated as “registration authority” under the ordinance to clear the applications of the MFIs for registration within a week of receiving them.

Project directors of Society for Elimination of Poverty in Rural Areas (SERP) and Mission for Elimination of Poverty in Municipal Areas (MEPMA), which oversee the activities of the 9.5 lakh self-help groups (SHGs) existing in the State, have been designated as the registration authority for the purpose.

Rural Development Minister Vatti Vasanth Kumar said as there are hardly 50 MFIs functioning in the State, the clearing of applications by the registration authority within the one-week deadline as stipulated by the High Court will not be a difficult task except for the cross-checking of the MFI's backgrounds and its claims of loaning activities in a particular area.

Speaking to reporters here on Friday, the Minister clarified that MFIs could now recover the loans given to the SHGs or its members, but without resorting to coercion, harassment or intimidation.

The staff of the MFIs designated to make recoveries, however, must carry their identity cards and should meet the SHG members only at Panchayat office in the presence of panchayat officer or sarpanch.