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.
|Published (Last):||3 May 2009|
|PDF File Size:||4.72 Mb|
|ePub File Size:||3.16 Mb|
|Price:||Free* [*Free Regsitration Required]|
Malegam Committee Report – Summary of Key Recommendations
But the immediate concern for the regulator is to address the customer protection and other issues raised by the Govt. You may be aware that within 2 weeks all the MFIs have submitted the data perhaps this is the only way things would work as we are used to learn the hard way.
Anonymous January 24, 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 commiftee greater flexibility to accommodate the diverse nature of Indian micro-finance and MFIs. Dear Sasi Garu Many thanks and I have enjoyed your analysis and responses as welll and I did with the one above I don’t understand though what is in the report that would stop state governments from doing what it did in AP again and again.
This seems fair committer an equity pun intended perspective…. Offer special incentives and tax breaks to MFIs seeking to reach underserved areas. 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 can explore and looking at ways of channelising the benefits available from the Govt.
To clarify, the issue is not one of not wanting to take on the regulator – I have been fairly critical of supervision in Indian MF and also talked of regulatory failure here Kaizad January 28, at 5: Enable public-private partnerships by linking MFIs with state-run microcredit programs. A second aspect that deserves appreciation is the fact that while the report has recommended continuation of priority sector funds for MFIs, it was however made it conditional — especially after recognizing some of the key problems like ghost lending, multiple lending, over lending and attempting to outline some measure to tackle them as well.
Ramesh S Arunachalam January 26, at More importantly, the resultant search for greater efficiencies will surely result in more short cuts being taken with regard to client acquisition, client engagement and the like – we all know what problems that all of this caused in AP in the recent past.
Malegam Committee Report on Microfinance: What’s On The Platter?
Excellent blog by Ramesh. 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 committed.
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 micrfinance to micro-finance.
Similar to SHG-bank linkage program. That said, I have pointed out several issues commitee the committee would need to think about seriously and thanks for your views and let me look at them closely and your points are well taken A third issue that merits appreciation is the fact that the report has sought to promote greater transparency with regard to interest rates…through various measures.
Seriously consider the proposal of small finance banks.
Ramesh – thanks for another good analysis. While we can separately discuss on the pros and cons of some of the suggestions, I really liked one idea of yours which is the repoet private partnerships. 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 commihtee the need for significantly enhancing the supervisory capacity of RBI with regard to micro-finance.
Malegam Committee Report – Summary of Key Recommendations
The much-awaited Malegam committee report is laudable because it is the 1 st committee report of some significance to attempt the creation on of a national regulatory framework for MF in India. Pragmatism is necessary coupled with better regulation to ensure to craete a win win situation. What authority does RBI has in controlling state’s populist actions. Honestly, I am evolving as a writer and I appreciate your feedback committed both postive and negative Thanks once again Look forward to meeting you some day For example, there are sometimes 6 MFIs sharing a JLG and its clients and this has been the REAL secret of the micro-finance growth story so far…Add to this the huge levels of indebtedness on the ground and I am not sure that the report provides maletam way out for these aspects…I hope that the committee and RBI look into and address these issues as otherwise, there would be no REAL way forward….
I think it would be unfair to criticize the Malegam committee report on the lack of implementation detail – after all, much of this can be detailed out only after the RBI accepts the various recommendations and I am sure that necessary precautions by the RBI will be taken with maleyam to codes of conduct, client protection measures, corporate governance etc. Malegam Committee on Microfinance leaves us with more questions than answers. Thanks for sharing this. Abhay January 25, at 8: 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.
Once the initial recommendations are refined and suitably accepted, I would additionally add that the Malegam committee should recommend the creation of an ongoing working sub-group or expert group that continues to be engaged with the sector for several years to come and that creates an ongoing implementable roadmap for delivery of other critical services that clients need.
Thanks Ramesh informative articles. Your views are highly balanced and enlightening.
A very critical aspect indeed….