Time for the bankers forum to Act

By Ramesh S Arunachalam, Rural Finance Practitioner

It is going to be almost 5.5 months since this blog writer had tried to warn the then newly formed (informal) bankers forum about the impending crisis in Indian micro-finance. The bankers forum apparently has been formed through a World Bank project being administered through The Small Industries Development Bank of India (SIDBI) and is called The Responsible Micro-Finance Project. A similar effort had been made by this blog writer to try and inform CGAP of the impending Indian micro-finance crisis. This was done as a reaction to their article on SKS, which, in the blog writer’s opinion ignored crucial facts available in the public domain (especially, Prof Sriram’s paper in EPW) with regard to Governance and other aspects at SKSML.

Now, you may argue that there is no use crying over spilt milk – fair point and agreed but there are important takeaways.…

Please look at this interesting e mail in circulation (names withheld) among the for profit MFIs and you can judge for your self the ground situation…I do VERY MUCH appreciate the initiative taken by the concerned MFI (which itself indicates a desire for responsible finance), although I feel that an appropriate process must be used to achieve the ends sort (in the e-mail) and it perhaps cannot be done unilaterally and that too via an (impersonal) e-mail…

Read the rest of the post on the Microfinance in India Blog

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