Microfinance company Arohan lowers interest rate to 25.7 per cent per year

KOLKATA: Microfinance company Arohan Financial Services reduced lending rate by 55 basis points to 25.70 per cent a year. The new rate is coming into effect from Monday.

Arohan, a part of the Intellecap Group, reduced the rate in step with reduction its cost of borrowing, a company official said.

"We are delighted to pass on this benefit to our customers and hope we can do more in the months to come,” Managing Director Manoj Kumar Nambiar said.

The reduction in interest rate is applicable for its basic loan product for the poor under which it lends up to Rs 50000 a borrower. A 100 basis points is equal to one per centage point.

“The growth that the company has witnessed over the last three years has resulted in improved efficiencies & increased traction with the banking community, and as a result, we have been able to procure funds at better rates," Nambiar said.

Arohan operates in Assam, Bihar, Jharkhand, Odisha and West Bengal.

Nambiar is also the president of Microfinance Institutions Network (MFIN), an industry association, which has requested its members to reduce lending rates by at least 25 basis points.