Bharat Financial Inclusion Limited, earlier known as SKS Microfinance Limited was incorporated as SKS Microfinance Private Limited, on September 22, 2003 under the Companies Act, 1956. The Company had obtained a certificate of registration from the RBI on January 20, 2005 to commence the business of a non-banking financial institution without accepting public deposits. With effect fromSeptember 1, 2005, the Company acquired business operations, assets and loan portfolio from SKS Society that was structured as a NGO and that was engaged in microfinance. In 1997, Swayam Krishi Sangam, or SKS Society, was founded as a public society in the state of Andhra Pradesh, and it functioned as a non-governmental organization, or NGO, that provided microfinance in Andhra Pradesh. After several years of operation as a NGO, SKS Society and its inherent not for profit business model was limited in its ability to address the credit needs of the poor throughout India. Accordingly, SKS Society decided it would transfer its business and operations to the company as of a newly incorporated private limited company in India in 2003.
BFIL distributes small loans that begin at Rs. 2,000 to Rs. 12,000 (about $44-$260) to poor women so they can start and expand simple businesses and increase their incomes. Their micro-enterprises range from raising cows and goats in order to sell their milk, to opening a village tea stall. BFIL uses the group lending model where poor women guarantee each other’s loans. Borrowers undergo financial literacy training and must pass a test before they are allowed to take out loans. Weekly meetings with borrowers follow a highly disciplined approach. Re-payment rates on our collateral-free loans are more than 99% because of this systematic process. BFIL also offers micro-insurance to the poor as well as financing for other goods and services that can help them combat poverty.
The Company is the largest MFI in India in terms of total value of loans outstanding, number of borrowers and number of branches, according to the October 2009 CRISIL report titled India Top 50 Microfinance Institutions, or the CRISIL Report. The Company is engaged in providing microfinance services to women in the lower income segment predominantly located in rural areas in India. In addition to its market leadership position and the expertise in microfinance which they have developed, they believe that their competitive strengths include their scalable operating model which leverages technology, diversified product revenues, diversified sources of capital and its pan-India distribution network. Their strategy is to further expand its membership, loans and product offerings by relying on these strengths.
The company continues to finance its expansion by accessing multiple sources of capital, both debt and equity, including listed debentures, priority sector qualifying loans from banks, and equity investments from venture capital and private equity investors, institutions and others. Additionally, they seek to sell or assign our portfolio loans to banks to improve its financial position and finance its growth. During the four year period from fiscal 2006 to fiscal 2010, they expanded their membership from 201,943 in five states to 6,780,145 in 19 states, and their branches expanded from 80 to 2,029. Their total portfolio loans outstanding increased at a CAGR of 147.7% from Rs. 780.50 million as of March 31, 2006 to Rs. 29,367.20 million as of March 31, 2010. Over the four year period from fiscal 2006 to fiscal 2010, their profit after tax increased at a CAGR of 221.0%, from Rs. 16.47 million to Rs. 1,748.40 million. For the year ended March 31, 2010, their total income was Rs. 9,589.28 million.
Milestones:
- September 22, 2003 - Incorporation of SKS Microfinance Private Limited
- January 20, 2005 - Registration with the RBI in the name of SKS Microfinance Private Limited to carry on the business as a non-banking financial institution without accepting deposits
- September 1, 2005 - Transfer of all assets and properties, pursuant to a MoU including the existing loans and receivables in relation to micro finance activities, to the company from SKS Society
- January 31, 2006 - Issue of 10,00,000 equity shares to SIDBI pursuant the subscription-cum-shareholders agreement dated January 31, 2006
- March 24, 2006 - Issue of equity shares pursuant to equity investments by the following: (i) MUC -- 20,99,040 equity shares; (ii) Vinod Khosla -- 20,99,040 equity shares; and (iii) The Ravi and Pratibha Reddy Foundation -- 20,99,040 equity shares.
- February 28, 2007 - The membership of the company crosses 5,00,000 in more than 250 branches across 11 states.
- March 29, 2007 - Issue of equity shares pursuant to equity investments by the following: (i) MUC -- 13,19,069 equity shares; (ii) Vinod Khosla -- 13,19,069 equity shares; (iii) SKS Capital -- 13,19,069 equity shares; (iv) Odyssey Capital Private Limited -- 8,94,064 equity shares; and (v) SCI II -- 5,430,468 equity shares.
- September 30, 2007 - The membership of the company crosses 10,00,000 in more than 500 branches across 15 states.
- December 14, 2007 - Social and Corporate Governance Award issued by BSE and Nasscom Foundation for Best Corporate Social Responsibility Practice
- December 27, 2007 - Issue of equity shares pursuant to equity investments by the following: (i) SIDBI -- 8,07,461 equity shares; (ii) Yatish Trading Company Private Limited -- 9,62,050 equity shares; (iii) Infocom Ventures -- 2,83,020 equity shares; (iv) Vinod Khosla -- 8,20,757 equity shares; (v) MUC -- 22,74,020 equity shares; (vi) SCI II -- 28,47,013 equity shares; (vii) SKS Capital -- 36,78,027 equity shares; (viii) Columbia Pacific Opportunity -- 275,944 equity shares; (ix) SCIGI I -- 29,96,396 equity shares; (x) SVB India Capital Partners I, L.P -- 2,75,944 equity shares; and (xi) Tejas Ventures -- 17,60,552 equity shares.
- May 6, 2008 - Certification bearing number 17998/08/S received from IQ Net that the quality management system of the company is in compliance with the standard ISO 9001:2000 in relation to the conducting of internal audits as per the policies and applicable standards.
- July 31, 2008 - The membership of the company crosses 2,500,000 in more than 1,100 branches across 15 states.
- October 20, 2008 - Issue of equity shares pursuant to equity investments by the following: (i) Sandstone Investment Partners I -- 20,85,448 equity shares and 62,56,344 preference shares (ii) Kismet SKS II -- 8,85,044 equity shares and 26,55,131 preference shares (iii) ICP Holdings I -- 81,383 equity shares and 2,44,150 preference shares
- February 27, 2009 - Issue of 2,500 10.5% secured redeemable NCD of face value of Rs 1,00,000 each aggregating Rs. 250 million to Yes Bank Limited on a private placement basis.
- April 23, 2009 - Issue of 750 10.0% secured redeemable NCD of face value of Rs 10,00,000 each aggregating Rs. 750 million to Standard Chartered Bank on a private placement basis. The said debentures have been listed on BSE pursuant to the listing agreement dated April 24, 2009.
- April 30, 2009 - The membership of the company crosses 4,000,000 in more than 1,400 branches across 18 states.
- May 20, 2009 - Fresh certificate of incorporation consequent to the change of the name on conversion to a public limited company pursuant to a resolution of its shareholders dated May 2, 2009
- June 3, 2009 - Registration with the RBI in the name of SKS Microfinance Limited to carry on the business of non-banking financial institutions without accepting deposits pursuant to the change in the name of the company on conversion to a public limited company.
- August 31, 2009 - The membership of the company crosses 5,000,000 in more than 1,600 branches across 19 states.
- November 24, 2009 - Religare Asset Management Company Limited has subscribed to commercial papers issued by the company for value of Rs 250 million having a discount rate of 8.10% per annum
- November 10, 2009 - Yes Bank Limited has subscribed to commercial papers issued by the company for value of Rs 1,000 million having a discount rate of 8.00% per annum
- December 9, 2009 - Issue of 500 NCD of Rs 10,00,000 each aggregating Rs. 500 million to BALICL at a coupon rate of 9.25% per annum
- December 23, 2009 - Issue of 500 NCD of Rs 10,00,000 each aggregating Rs 500 million to Yes Bank at a coupon rate of 8.30% per annum. The said debentures have been listed on BSE pursuant to the listing agreement dated December 29, 2009.
- December 30, 2009 - Tata Capital Limited has subscribed to commercial papers issued by the company for value of Rs 200 million having a discount rate of 8.10% per annum
- January 11, 2010 - Sanction by State Bank of India of Rs 350 million towards term loans and Rs 650 million towards cash credit for on lending purpose.
- January 12, 2010 - Availing of microfinance corporate loan facility with HDFC for Rs 100 million to provide financial assistance for undertaking housing finance activities
- January 18, 2010 - Agreement with HDFC on Technology license and service usage for undertaking housing finance activities.
- January 19, 2010 - Issue of 9,37,770 equity shares pursuant to equity investments by Catamaran
- February 3, 2010 - Tie up with State Bank of India, State Bank of Hyderabad and State Bank of Mysore for online integration of 585 branch bank accounts of the company through CMS
- February 4, 2010 - Religare Asset Management Company Limited subscribed to commercial papers issued by the company for value of Rs 250 million having a discount rate of 6.6% per annum.
- February 10, 2010 - MOU with Future Group for purchase of supplies by kirana stores on a wholesale basis located in and around New Delhi.
- March 8, 2010 - Sanction of Tier-II unsecured subordinated debt of Rs. 1,000 million by SIDBI for tenure of eight years
- 2017- Bharat Financial Inclusion in Forbes Super 50 list
- - Bharat Financial Approves Merger with IndusInd bank
Product and services:
1. Proprietary Products
- Income Generating Loans
- Mid-Term Loans
- Life Insurance Loans
- Emergency Loans
- Productivity Loans
- Individual Loans
2. Distributor Products
- Loan Cover Insurance
- Life Insurance
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