The state High Court, on Wednesday, adjourned a hearing on a writ petition challenging the constitutional validity of the
Ordinance issued by the State government to regulate Micro Finance Institutions (MFIs), to Friday.
While accepting the petition filed by M R Rao on behalf of SKS Microfinance Limited on Tuesday, the court directed the State government to clarify its stand on actual interest and minimum interest charged by the finance institutions, by Friday.
In his petition, M R Rao contended that the subject was within the purview of the Reserve Bank of India, and that the State government and Legislature has no powers to pass a law in this regard.
Meanwhile, the RBI has constituted a sub-committee of its Central Board of Directors to study the issues and concerns relating to the MFIs, including the "ways and means of making the interest rates charged by them reasonable."
The committee, headed by Y H Malegam, would submit its report to the government within 3 months.
Courtesy: INN