Hyderabad, Dec 14 (IANS) The Andhra Pradesh assembly Tuesday night passed a bill to regulate micro finance institutions (MFIs) in the state.
The Andhra Pradesh Micro Finance Institutions (Regulation of Money Lending) Bill, 2010, was passed with a voice vote after a two-hour long debate and in the absence of main opposition Telugu Desam Party (TDP), whose legislators were earlier suspended from the house for stalling proceedings.
The bill, on being passed in the legislative council, would replace the ordinance issued by the government Oct 15 following a spate of suicides by many small borrowers.
The government turned down the demand by opposition parties to refer the bill to select committee to make it a comprehensive legislation. Women Development and Self-Help Groups Minister Sunitha Lakshma Reddy said this could result in the lapse of the ordinance.
She said the legislation would come to the rescue of over 10 million poor women in the rural areas, who were being subjected to harassment by MFIs to recover the loans.
She said the government issued the ordinance after 75 borrowers committed suicide during last few weeks due to harassment by MFIs.
According to the provisions of the legislation, MFIs can’t deploy any agent for recovery of loans or resort to any coercive action. Any person, who contravenes the provisions, will be punishable with an imprisonment for a period of six months or with a fine which may extend up to Rs.10,000 or both.
