At the second day of the Microcredit Summit India 2011, Reserve Bank of India (RBI) Deputy Governor H R Khan announces External Commercial Borrowings (ECB) of USD 10 million for all MFIs. So far only NGO- MFI have been allowed. In his closing speech he also stressed for a multi agency approach. Banks were encouraged to lend to the microfinance sector. He stressed different strengths of different sector. He also stated that “without going into why the crisis happened, I think no crisis should be wasted. I think we have to look forward and think how to move forward.” He’s suggestion was CSR which stands for Credibility, Sustainability and Responsibility. He mentioned that this has been brought out in the Malegam report. In term of credibility, there is a need for fair prices. The loan card should be with the client and in his vernacular language. We need to eliminate abusive collection practices. Mr. Khan mentioned, “I am happy MFIN and Sa Dhan has come out with this Code of Conduct.” The crisis has taught us we need to practice sustainability in the microfinance sector. In the case of responsibility, there needs to be a distinction between making profit and profiteering. We need to eliminate multiple lending and ghost lending, he stated.
Microfinance Focus
