Microfinance industry optimistic about its future
Microfinance Focus, March 10, 2012: Mint conclave conference was held recently in New Delhi, India to discuss and debate about current situation and prospect of microfinance business. The event was organized by MINT, a leading Print Media with a joint collaboration between International Finance Corporation (IFC) and Microfinance Institutions Network (MFIN).
The conference panelists included Dr. K.P. Krishnan, Member, Secretary, Economic Advisory Council to the Prime Minister, J.K. Sinha, Chief General Manager, SBI, Samit Ghosh, MD, Ujjvan Microfinance, Jennifer Isern, Manager, Access Finance Advisory, South Asia (IFC), P.D. Rai MP and member of Financial Standing Committee along with Alok Prasad CEO of MFIN. The Session is moderated by Tamal Bandyopadhyay, Deputy Managing Editor of Mint.
During the conference, P.D. Rai, MP and Member of Financial Standing Committee said, “I am on the side of MFI”, and indicated that because of some bad apples the sector landed into crisis.
Dr. K.P. Krishnan, Secretary to the Economic Advisory Council to the Prime minister of India, said “The tendency of public policy and regulation is restrictive.” Further he said, “MFIs were a clear example. They were beginning to make a difference but I think the core ideological India hits back, it says ‘No’, There is only one model, we will decide what is good and hence you can see Andhra Pradesh ordinance.”
He further added, “You see the Malegam Committee recommendations, which variably talked off, I don’t have visionary control of growth therefore, and I am going to curb the growth”, He added. I think, “There has been a fundamental clash to handle development. There are more solutions there are possible what we tried out, in the past. Entire sector, to be hanged because there are some bad apples, “obviously it should not.” We need to figure out smartfully.”
Jayanth Sinha, Chief General Manager, SBI noted that earlier MFI was meant for social intention and later on it has turned into profit orientation. MFI should follow a responsible lending’.
Samit Ghosh, MD, Ujjvan, a Bangalore based Microfinance Company stated, “The role of microcredit has been oversimplified. That it will alleviate the poverty. But I think microfinance is a vehicle for the financial inclusion.”
Karnataka, India is a state where MFI is functioning really well and is a role model to the entire nation. MFIs in Karnataka have shown a best example to show coordinated work among the stakeholders and co-exist together, he added.
Jennifer Isern, Manager, Access Finance Advisory, South Asia (IFC) said, “IFC is very much optimistic about Microfinance. So much went right, lots of good work has been done, and it demonstrated way to do sustainable business.”