Mumbai: Shares in the country’s biggest lender to the poor, SKS Microfinance, rose 5% in early trade Thursday after its founder-chairman said he was leaving the loss-making firm.
SKS shares rose to Rs 121.8 at the Bombay Stock Exchange (BSE) on hopes the firm would now be able to chart out a new growth strategy.
Vikram Akula, who set up the firm in 1997, announced his resignation on Wednesday night, hours after media reports that he was under pressure to quit due to differences of opinion on how to revive SKS’s fortunes.
Vikram Akula, erstwhile founder-chairman of India’s largest lender to the poor, SKS Microfinance. Photo: AFP
Earnings have been falling since October 2010 after the government of Andhra Pradesh, the hub of the microfinance industry, accused lenders of exploiting poor borrowers with high interest rates and harsh debt collection tactics.
SKS, based in the southern city of Hyderabad, said board member Puranam Hayagreeva Ravikumar would take over as the interim non-executive chairman.
Akula - considered the father of Indian microfinance - said he was confident that “the current leadership of SKS is well-equipped to take it into the next phase of evolution”.
The US citizen said he would remain committed to the microfinance sector at a policy level and would be involved in a mobile banking initiative, which he said would “create an improved platform” for low-cost lending.