This conceptual framework also helps analyse two policy responses, viz, the malegam report and the draft microfinance bill, 2011. It consists of senior representatives of bank supervisory authorities and central. They form a part of the polity and governance portions of the ias exam the board of directors of the reserve bank of india, formed a subcommittee of the board to study matters and concerns in the microfinance sector in so far as they are. Malegam report to hurt microfinance the economic times. Second, the malegam report suggests that mfis restrict their loan size to. Malegam committee recommendations for microfinance sector in india pdf65pages265kb. Rbi constitutes yh malegam committee to monitor bad loans, rising cases of frauds, audits february 21, 2018 reserve bank of india rbi has constituted an expert committee to look into the entire gamut of issues relating to classification of bad loans, effectiveness of.
An empirical analysis of the microfinance industry shows that the recommendations of the malegam committee would have significantly more detrimental consequences than have been anticipated in the report. Sa dhan organised, 9th national financial inclusion conference on march 14, 2014, in yashwantrao chavan, centre, mumbai, the financial capital of the country. Rbi constitutes yh malegam committee to monitor bad loans, rising cases of frauds, audits february 21, 2018 reserve bank of india rbi has constituted an expert committee to look into the entire gamut of issues relating to classification of bad loans, effectiveness of audits and rising incidents of frauds. Aug 09, 2018 latest current affairs in may, 2020 about malegam committee. While he argues that the report has somecontinue reading. Malegam contended that the microfinance institutions have neglected the poor. Effects of microfinance on poverty reduction as defined by the millennium goals section 1. Achieving financial sustainability means reducing transaction costs, offering better products and services that meet client needs, and finding new ways to reach the unbanked poor. Microfinance as a poverty reduction toola critical assessment. The malegam committee was established by rbi in 2010 to study issues and concerns in the mfi sector. Committee recommendations for microfinance sector in india pdf65pages. The malegam committee microfinance report will the mfis accept it. It consists of senior representatives of bank supervisory authorities and central banks from argentina, australia, belgium, brazil. Malegam committee report on the microfinance sector the microfinance industry had come under the scanner when the andhra pradesh government passed an ordinance calling the borrowers to stop paying their loans, making it illegal for the micro lenders to ask for weekly repayments and also required them to get a no objection.
Beneficial in scope but micro measures limit impact on. The microfinance in india a state of sector report 2010 also says that there are. The board of directors of the reserve bank of india. Recent regulatory discussion surrounds the partial acceptance of the malegam report by rbi in may 2011, where rbi created the nbfcmfi designation. At the same time, many of the tactical and operational prescriptions made by the committee require to be. Interview with mr vijay kumar, joint secretary, ministry of rural development, government of india 103. Andhra pradesh microfinance, capital requirements, dairy institute, high interest rates, institute of rural management anand, irma india, malegam committee report, malegam committee report mfi sector, microfinance interest rates cap, nbfcmfi, opinion malegam report, rural management india.
The third and final area that i want to talk about before handing it over to my colleagues is the malegam report. Dvara research blog regulating microfinance in india. Pdf on nov 7, saswat barpanda and others published the malegam committee microfinance report. Malegam 2011, report of the subcommittee of the central board of directors of reserve bank of india to study issues and concerns in the mfi sector, retrieved from in august 2011. The committee submitted its report in december 2011. Formation of malegam committee by rbi to study the issues and concerns in. I am particularly pleased with the explicit focus on consumers and their needsthis, together with the onset of technologybased delivery models, has been the most important shift in the microfinance field over the past 15 years. The report covers the present scenario and the growth prospects of the global microfinance market for 20162020. Table 1 displays the information on several parameters of indian mfi. The more comprehensive ministry of finance, 2011 has been tabled in parliament in may 2012. Entering a phase of moderate credit risk, three years post ap crisis summary microfinance sector in india has gone through 3 broad risk phases in the past high growth till 2010, high volatility 2010 11, consolidation 2011 and is now entering a iv phase of relative stability. Jan, 2014 malegam committee recommendations the rbi appointed mr. Annual report the board of directors has established an audit.
Comparison of 2007 and 2011 versions of the microfinance bill 94 7. Sks microfinance limited q3 fy11 results conference call. I risk of working with the very poor claims of usurious loan rates cannot be refuted very readily. The basel committee on banking supervision is a committee of banking supervisory authorities which was established by the central bank governors of the group of ten countries in 1975. What should regulation do in the field of microfinance. Overview the poorest and poverty reduction have become the object of unprecedented attention at international summits in the 1990s. Malegam committee the subcommittee of the central board of directors of reserve bank of india to study issues and concerns in the mfi sector related to the entities regulated by the bank has submitted its report to the rbi in january 2011. The malegam committees referred to hereinafter as the committee recommendations to increase the supervisory capacity of the rbi, to make mfi regulation consistent at the national level, to promote good corporate governance and to increase bank lending to mfis are welcome. Video interview with y h malegam on the report livemint malegam committee report will not push poor to the moneylender shashi rajgopalan, member of the malegam committee read prof m. Rbi released the malegam committee microfinance report on 19. I am particularly pleased with the explicit focus on consumers and their needsthis, together with the onset of technologybased delivery models, has been the most important. Malegam committee upsc, y h malegam committee details for.
This subcommittee of the board was formed on october 15, 2010, under the chairmanship of mr y. Canada, through the canadian international development agency cida, has committed to the targets set by both the oecd international development. Malegam committee recommendations the rbi appointed mr. Malegam was appointed chairman of the famous malegam committee subcommittee of the rbi central board of directors set up to study issues and concerns in the mfi sector. The terms of mention of the subcommittee included framing the description of microfinance and micro finance institutions mfis for the point of regulation of nonbanking finance companies nbfcs undertaking microfinance by the reserve bank of india and do proper. Most of the measures proposed come from the report written by the malegam committee, set up in october 2010 following the ordinance promulgated by the government of ap. Malegam 2011, report of the subcommittee of the central board of directors of reserve bank of india to study issues and concerns in the. Malegam committee report on issues facing the microfinance. About 30% of mfi loans are purportedly in andhra pradesh.
The microfinance has evolved due to the efforts of committed individuals and financial agencies to promote selfemployment and contribute to poverty alleviation and provision of social security. As all of you know the malegam committee has come out with a set of recommendations for microfinance and we generally welcome the recommendations that have been put forth. Crisp news summaries and articles on current events about malegam committee for ibps, banking, upsc, civil services. The committee was tasked with proposing regulations for the microfinance sector to curb issues related to overborrowing, multiplelending and forceful recovery methods. We also describe eys position in the microfinance industry sharing the services and support that we can provide. The muchawaited 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. By ramesh s arunachalam, rural finance practitioner malegam committee microfinance report the muchawaited 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. Ismail2 school school of economics universiti kebangsaan malaysia bangi, 43600 selangor d. Sustainability of bmt financing for developing microenterprises widiyanto b. The report contains suggestions to regulate the microfinance sector, pricing of interest.
Microfinance is about building permanent local financial institutions. Latest current affairs in may, 2020 about malegam committee. After the ap crisis of 2010, the malegam 2011 report has been adopted as the defacto framework for regulation of the nbfc mfis. Jan 26, 2020 attock cement pakistan limiteda n n u a l r e p o r t 2 0 1 1. Microfinance in india a state of the sector report 2010. S shylendras response at malegam committee report on mfi sector. Role of mfis in financial inclusion bappaditya mukhopadhyay. The malegam committee report must be strongly appreciated because it seeks to legitimize. As per the report status of microfinance in india by national bank for. Cgap 1818 h street, nw msn q4400 washington, dc 20433 tel.
By ramesh s arunachalam, rural finance practitioner we have all being waiting for this report i and here is the summary of recommendationstaken from the report i will start providing an analysis of the same, bit by bit, hereafter the board of directors of the reserve bank of india, at its meeting held on october 15, 2010 formed a subcommittee. Pdf the malegam committee microfinance report will the. Report summary malegam committee on microfinance prs. The new microfinance handbook fills a critical gap in the current literature on financial inclusion. The poor need a variety of financial services, not just loans. The muchawaited malegam committee report is laudable because reoort is the 1st committee report of some significance to attempt the creation on of a national regulatory framework for microfinance in india.
Microfinance as a poverty reduction toola critical. I have code sample here, i can save as a pdf file directly but what repportdocument want to do is to show client expoet pdf file, and allow users to save it. Will the mfis accept it malegam committee report on mfi download as pdf file. Comments on the recommendations of the malegam committee the malegam committee was established in an environment of crisis in indian microfinance, against the backdrop of the ap microfinance institutions ordinance now act instituted. The committees report, released in 2011, recommended the creation of a separate category of nonbanking financial companies nbfcs operating in the microfinancesector, and meeting a set of qualifications,to be designated as nbfcmfis. To calculate the market size, the report considers the the total financing of the micro enterprises in the americas, asia pacific apac, and. The malegam committee report must be strongly appreciated because it seeks to legitimize microfinance as an integral part of the indian financial sector. Regulatory framework in the aftermath of andhra pradesh crisis and subsequent to the malegam committee recommendations, rbi came up with two significant notifications. Building financial systems for the poor key principles of microfinance 1. Malegam committee microfinance report summary of reactions. On the website, an indian partner of the usbased wall street journal, independent researcher ms sriram presented his evaluation of the recommendations issued in response to the crisis in the microfinance sector in andhra pradesh by the malegam committee of the reserve bank of india rbi. Attock cement pakistan limiteda n n u a l r e p o r t 2 0 1 1. The role of the government in indias microfinance industry.
610 611 983 583 189 532 874 1005 888 166 489 593 552 1211 519 1102 926 193 1457 799 1510 806 1258 374 1064 423 1040 325 193 214 395 1046 861 1305 1381