MALEGAM COMMITTEE REPORT ON MICROFINANCE PDF

Report Summary. Malegam Committee on Microfinance. (January ). Background. The Board of Directors of the Reserve Bank of India. (RBI) constituted a. PDF | On Nov 7, , Saswat Barpanda and others published The Malegam Committee Microfinance Report: Will the MFIs Accept It?. Malegam Committee Report on MFI – Download as PDF File .pdf), Text File .txt) or read online.

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Malegam Committee Report on Microfinance: What’s On The Platter?

A third issue deport merits appreciation is the fact that the report has sought to promote greater transparency with regard to interest rates…through various measures.

Vijay January 24, at 9: Read a lot of your work and enjoy it While each recommendation by itself is well-intentioned, the net effect may be disastrous.

Dear Ramesh Thank you micrkfinance summing up the salient points and your to the point recommendations. Also the regulators focus when introducing guidelines would be more to see on handling exceptions, so how do you ensure that the borrower is not becoming a member in multiple groups and threatening the very basic principle of peer pressure on which the model works Have a great day and wonderful start into the week!

But what I fail to understand is how is this going to help in cases like AP. Enable public-private partnerships by linking MFIs with state-run microcredit programs.

Dear Ramesh, This is a wonderful blog. A second aspect that deserves appreciation is the fact that while the report has recommended continuation of priority sector funds geport MFIs, it was however made it conditional — especially after recognizing some of the key microfinancs like ghost lending, multiple lending, over lending and attempting to outline some measure to tackle them as well.

Ofcourse, the good thing is Malegam Committee has specifically suggested that RBI should come out with a detailed customer protection guidelines, which perhaps would give the state Govt some comfort to withdraw the monsterous act As it is proven that MFIs, are efficient and effective in reaching out the last mile, it would be interesting if the Govt and the MFis o explore and looking at ways of channelising the benefits available from the Govt.

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This ensures that micro-finance will come under the purview of the RBI and no longer can microfinance be treated as a fringe activity or as an orphaned child kn the larger Indian financial sector. I agree that the committee provides much needed legitimacy to the sector by emphasizing the need for enhanced regulation.

Newer Post Older Post Home. Ramesh S Arunachalam January 26, at Hence, the committee may consider removal of the capping on overall interest, while continuing to suggest the capping of the margins — but through more appropriate slabs and with greater flexibility to accommodate the diverse nature of Indian micro-finance and MFIs.

Overall, the Malegam Committee has done a highly commendable job with a very complex problem and that needs to fully recognized and well appreciated.

Malegam Committee Report – Summary of Key Recommendations

Unfortunately despite this attempt the State Govt still feels that the RBI report is more to protect MFIs interest than the customers interest, so they want more micro management from RBI than what is proposed in the Malegam committee report Ramesh – thanks for another good analysis.

But the immediate concern for the regulator is to address the customer protection and other commitree raised by the Govt.

Fourth, the report has recognized and stressed the importance of off-site and on-site supervision of NBFC MFIs including systemically important ones while also alluding to the need for significantly enhancing the supervisory capacity of RBI with regard to micro-finance. Not sure, how RBI would balance this Excellent blog by Ramesh. It has shown the right strategic intent and direction for establishing a uniform national regulatory framework for micro-finance in India that attempts to put clients first… Ladies and Gentlemen, let us give the committee a Big Warm Hand …rather than JUST nitpicking on specific issues that can perhaps be sorted out through discussion and dialogue… Clearly, it is about time that we – stop being Penny Wise and Pound Foolish and – recognize the huge and legitimate platform for action that the Malegam committee has provided all of us….

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Malegam Committee Report – Summary of Key Recommendations

By recommending creation of a new category – called NBFC MFIs with associated conditions which are perhaps open for discussion – the report has clearly positioned and mainstreamed micro-finance within the framework of the larger financial sector in India.

What do you think, did I misread the recommendations? Sixth, there are several other aspects in the report that require commendation: A second aspect is the use of caps for annual family incomerestricting it to Rs. Sasi January 26, at Consider expanding the definition of microfinance to include not just micro credit for all purposes but a full suite of financial services.

Eighth, it would also be useful if the committee looks at the aspect of equity investment in MFIs and build necessary safeguards to ensure that what happened in AP does not recur again. Fifth, the strong emphasis on corporate governance is note worthy and specifically, the committee has suggested that corporate governance rules will have to be specified encompassing several issues for NBFC MFIs by the regulator.

Malegam Committee Report on Microfinance: What’s On The Platter?

Bonam Srinivas January 28, at The much-awaited Malegam committee report is laudable because it is the 1st committee report of some significance to attempt the creation on of a national regulatory framework for Microfinance in India. At any rate, not treating Sa-dhan as an MFI association will again be perceived as patently unfair and hence, this aspect also needs to be reconsidered…and perhaps changed accordingly It seems fommittee within the proposed regulation that a borrower earning Rs.

To conclude, I feel once a special category NBFC MFIs is created and the black sheep is weeded out nothing stops RBI from going ahead with your suggestions below which are microfinancr a definite need for the long term sustainability of the sector.

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