Vikram Akula to acquire 26 % stake in financial inclusion start-up VAYA

Moneylife Digital Team 10 December 2014

VAYA is a business correspondent which facilitates savings and loans for self-help groups of women on behalf of banks

Vikram Akula, the controversial founder and former chairperson of SKS Microfinance, who was removed from SKS Microfinance after the Andhra Pradesh microfinance crisis, has been appointed chairman of the financial inclusion start-up VAYA Finserv Pvt. Ltd. Akula will also take a 26% stake in VAYA, according to a release from the company.

VAYA is a business correspondent which facilitates savings and loans for self-help groups of women on behalf of banks. The company was founded by former SKS Microfinance executives and opened its first branch in July, and now has 23 branches with 183 employees across six districts of Eastern Maharashtra and Northern Karnataka.

“Now that my 3 year non-compete period is over, I was looking to get back to financial inclusion,” said Akula. “I chose to join VAYA because it is focused on under-banked districts, it has a great team, and it uses a next-generation technology platform that will become the future of financial inclusion.” VAYA is the first business correspondent to use tablet banking in the field. The field officers tablets connect to a centralised online system that has the ability to interface seamlessly with core banking systems, to ensure daily cash settlement with partner banks.

Akula commented that VAYA is intending to apply for a bank license. “I think that both the creation of small banks as well payments banks is an extremely progressive step on the part of the RBI, and this will certainly help enhance financial inclusion. We are working with our advisors on preparing a small bank license application.”

The Reserve Bank of India (RBI) had released final guidelines for small banks and payment banks on 27 November and sought applications by 16 January from those interested in applying for a small bank licence. “While VAYA has a robust plan to grow as a BC, a small bank licence will assist us in furthering financial inclusion by providing loans to small business units, small and marginal farmers, micro and small industries and other unorganized sector entities” said Vikram Akula. “We also have an option to apply for a payments bank license,” added Akula.

While Akula garnered many accolades over his career and initial years at SKS Microfinance, the Andhra Pradesh Microfinance crisis seriously dented the industry and the company. SKS refused to accept Akula's presence on its board. Under Akula's watch, SKS suppered the brunt of the Andhra Pradesh crisis, which resulted in a huge loss of jobs and extensive delinquency of loans. The RBI restructured microfinance loan books, and it is to be seen if and how the RBI considers at Akula's this latest foray and bank license application.

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