Bharat Financial Inclusion
Bharat Financial Inclusion was an Indian non-banking financial company that provided microfinance and other financial services to low-income customers, particularly women in rural communities.
Last updated August 31, 2026
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History
Bharat Financial Inclusion traces its origins to Swayam Krishi Sangham, a nonprofit founded by Vikram Akula in 1997 in Andhra Pradesh. Inspired by the Grameen Bank approach, the organization sought to use small-scale finance to support poor households. Its early operating model relied on village-based loan marketers who were compensated through commissions. In 2003, Akula established a for-profit entity, SKS Microfinance Private Limited, to develop the lending operation commercially. SKS Mutual Benefit Trusts, funded among women in Andhra Pradesh villages, formed part of the early capital structure. By 2005, SKS Microfinance had raised enough capital to become a non-banking financial company. The company expanded rapidly through institutional equity investment. Sequoia Capital led an investment reported at $11.5 million in 2007, and Sandstone Capital led a further reported $74.5 million investment in 2008. The growth strategy was based on standardized group lending, branch expansion, and the use of social rather than physical collateral. Individual women borrowers were commonly organized into five-member joint-liability groups. This structure was designed to reduce information problems and repayment risk where borrowers had limited assets that could be pledged as security. SKS Microfinance became one of India's most visible microfinance companies when it listed on the Bombay Stock Exchange on 28 July 2010. The initial public offering was reported to have been oversubscribed 14 times. The public listing also attracted criticism from observers who argued that pressure to satisfy investors could conflict with the poverty-alleviation objectives associated with microfinance. Muhammad Yunus publicly expressed concern that a public-company structure might prioritize shareholder demands over the needs of poor borrowers. The company's growth was followed by a major crisis in Andhra Pradesh. From September 2010, media reports described nearly 200 suicides among borrowers of several microfinance institutions, including SKS. The state government opened an inquiry. Subsequent reporting and investigations examined alleged coercive collection methods, aggressive loan marketing, multiple borrowing, and the burden placed on rural families. An investigation commissioned by the company associated SKS staff with at least seven creditor suicides, while another investigation considered possible involvement in two additional cases. The controversy caused a major contraction of operations in Andhra Pradesh. In 2012, SKS cut approximately 1,200 jobs and closed 78 branches in the state. The crisis also affected corporate leadership and market value. Vikram Akula resigned from the board on 23 November 2011. P. H. Ravi Kumar became non-executive chairman in 2015. The company's shares reportedly fell by 96 percent from a 2010 high of Rs. 1,491.50. In 2014, Unitus Corporation's Mauritius unit, Sequoia Capital India Growth Investments, SKS Mutual Benefit Trust, and Vikram Akula relinquished their roles as promoters, according to the supplied reference. During the later restructuring of its business, SKS reduced the price of selected loans and diversified its service model. In November 2015, it cut the interest rate on core income-generation loans to 19.75 percent, described as the first sub-20-percent rate in that segment among Indian microlenders at the time. The company also offered income-generation, mid-term, long-term, product-purchase, gold-backed, and insurance-related services. Its customer base expanded beyond women borrowers to include men and loans for purposes such as marriage expenses and seed purchases. In 2016, SKS Microfinance adopted the name Bharat Financial Inclusion Limited. In 2017, it introduced Aadhaar-based loan approval to shorten processing time and reduce costs. It also launched a kirana-store service through which customers could conduct financial transactions at participating local shops. Discussions with IndusInd Bank about a merger began in 2017, and approvals from the Reserve Bank of India, the National Stock Exchange of India, and the Bombay Stock Exchange followed in 2018. The combination ultimately brought BFIL into IndusInd Bank and ended its existence as an independent listed company. The supplied material does not establish whether Bharat Financial Inclusion continues as a distinct consumer-facing brand, so its standalone current status remains unknown.
- 2018
Merger approvals
[1]The proposed combination with IndusInd Bank received approvals from the RBI, NSE, and BSE.
- 2017
Digital approval and kirana services
[1]BFIL introduced Aadhaar-based loan approval and a kirana-store transaction service.
- 2016
Rebranding as Bharat Financial Inclusion
[1]SKS Microfinance changed its name to Bharat Financial Inclusion Limited.
- 2015
Interest rate reduced
[1]The company reduced the rate on core income-generation loans to 19.75 percent.
- 2012
Andhra Pradesh retrenchment
[1]The company cut approximately 1,200 jobs and closed 78 branches in Andhra Pradesh amid the microfinance crisis.
- 2011
Founder leaves the board
[1]Vikram Akula resigned from the board on 23 November 2011.
- 2010
Public listing
[1]SKS Microfinance debuted on the Bombay Stock Exchange on 28 July in a heavily oversubscribed IPO.
- 2008
Sandstone-led equity financing
[1]The company raised a reported $74.5 million in equity financing led by Sandstone Capital.
- 2007
Sequoia-led equity financing
[1]SKS raised a reported $11.5 million in equity financing led by Sequoia Capital.
- 2005
SKS becomes a non-banking financial company
[1]SKS Microfinance raised sufficient capital to operate as an NBFC.
Products and positioning
Financial inclusion and microfinance provider focused on extending formal credit and related services to low-income and traditionally underserved Indian households, especially rural women and self-employed borrowers.
Microfinance lending
Joint-liability-group microfinance loans
The company's core model provided loans to individual borrowers organized into small joint-liability groups, commonly consisting of five women. Group members served as a form of social collateral, helping address the lack of conventional pledged assets and allowing lending to low-income customers in rural communities.
Microfinance lending
Income-generation loans
Income-generation loans supported small livelihood activities such as livestock raising, tailoring, local retail, and other self-employment or service businesses. They were positioned as a means of helping borrowers develop or maintain household enterprises.
Microfinance lending
Mid-term and long-term loans
SKS offered loan products with different durations to meet financing needs beyond its core short-cycle microfinance activity. The supplied reference identifies mid-term and long-term loans but does not provide detailed duration or eligibility information.
Consumer and livelihood finance
Product-purchase loans
The company provided financing for products intended to support household welfare or economic activity, including cook-stoves, solar lights, water purifiers, mobile phones, bicycles, and sewing machines.
Secured lending
Gold-backed loans
Gold-backed lending allowed customers to obtain finance against gold jewellery. The supplied reference identifies this product category but does not specify its detailed terms, distribution model, or subsequent status.
Financial access and payments · 2017
Kirana store financial services
Introduced in 2017, the kirana-store service used designated local general stores as access points where customers could conduct financial transactions. The initiative extended the company's distribution network into familiar neighborhood retail locations.
Insurance-related financial services
Life assurance
Life assurance was among the financial services associated with the SKS offering. The supplied material does not identify the underwriting partner, product terms, or whether the service remained available after the IndusInd Bank combination.
Controversies
2010
Andhra Pradesh borrower-suicide and collection-practices crisis
Reports of nearly 200 borrower suicides involving several microfinance institutions, including SKS, led to an Andhra Pradesh government inquiry. Later investigations and reporting examined alleged pressure by loan agents, aggressive collection practices, large or multiple loans, and the relationship between SKS personnel and several creditor suicides. The controversy severely affected the company's reputation and operations in the state.
Brand decisions
2017
Aadhaar-based loan approval systemProduct launchBackground
The company sought to make loan processing faster and less costly through digital identity and automated approval infrastructure.
Action taken
BFIL launched a loan-approval system based on Aadhaar.
Aftermath
The stated goals were to reduce approval time and operating costs. The supplied material does not quantify the resulting effect.
2017
Kirana-store transaction serviceProduct launchBackground
Many target customers lived in communities where local general stores were more accessible than formal bank branches.
Action taken
BFIL enabled customers to conduct financial transactions through designated kirana stores.
Aftermath
The service broadened the company's local distribution model, although the supplied material does not provide adoption figures or a later standalone status.
2017
Proposed merger with IndusInd BankM&ABackground
BFIL entered discussions with IndusInd Bank as part of a possible combination between a large bank and a financial-inclusion-focused lending business.
Action taken
The parties pursued a merger that received approvals from the Reserve Bank of India, the National Stock Exchange of India, and the Bombay Stock Exchange in 2018.
Aftermath
Bharat Financial Inclusion ultimately became part of IndusInd Bank, ending its existence as an independent listed company.
2016
Rebranding from SKS Microfinance to Bharat Financial InclusionStrategyBackground
Following the Andhra Pradesh crisis and a broader evolution of its services, the company sought an identity centered on financial inclusion rather than only its historical SKS microfinance name.
Action taken
SKS Microfinance was renamed Bharat Financial Inclusion Limited.
Aftermath
The new name became associated with the company's broader lending, insurance, transaction, and financial-access activities. The later merger with IndusInd Bank ended the company's independent listed-company status.
2015
Reduction of core loan interest ratesPrice changeBackground
The Indian microfinance market was becoming more competitive, while lenders benefited from lower-cost funding and operating efficiencies. The RBI had also changed the borrower limit applicable to certain microfinance loans.
Action taken
SKS reduced the interest rate on core income-generation loans by one percentage point to 19.75 percent.
Aftermath
The company presented the move as making it the first Indian microlender to offer a sub-20-percent rate on its core income-generation loans. The supplied reference does not provide later financial results attributable to the decision.
Sources1 sources
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