In India, social enterprises have become a national phenomenon in less than a decade, with a growing ecosystem of supporting players. Yet, despite this impressive growth, little is known about these social enterprises collectively: their geographic and sector distribution, business structure, stage of development, financial viability and funding sources.
In December 2010 the Government of Andhra Pradesh (“AP”) passed a law (the “AP Act”, originally conceived in October 2010) which effectively shut down private sector microfinance in the State. The AP Government stated that its goal was to protect the poor. Now, 18 months later, the impact of the AP Act is clear: rather than protecting the poor, it has had the opposite effect, harming the poor by starving them of access to credit and basic financial services.
A study by Legatum Ventures, with contributions from Intellecap.
In the fall of 2010, a microfinance crisis started in the southern Indian state of Andhra Pradesh, and had implications for the industry nationwide. One of these had been the recommendations put forth to the Reserve Bank of India (RBI) by the Malegam Committee. Intellecap released a white paper responding to these recommendations.