SKS moves SC against Andhra Pradesh Micro Finance Act

NEW DELHI: SKS Microfinance on Thursday challenged in the Supreme Court the special Act passed by the Andhra Pradesh government to regulate micro finance institutions in the state after allegations that their high interest rates and strong-arm recovery methods led to suicides by farmers.

An SC bench issued notice to the state government, directing it to file reply and posted the matter for hearing in the third week of July.

According to the petition, the state government has no power to regulate the sector. Micro finance sector falls under the central list and is not a state subject on which the AP government could pass any Act, SKS said.