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Micro Finance Programme
Microfinance MIS system can help
financial
service providers
to profit from
reduced transaction costs and
improved portfolio quality and
moreover, it
improves transparency in financial transactions and
protects poor
borrowers
and MFI institutions
in reducing the
existing tensions in the country in general
and Bihar in particular.
The existing credit
bureau
facilities in some form or
other in some of the
areas are still either unavailable or inaccessible to a
larger
number of service providers and
existing nature of information sharing
is often
limited to a relatively small number of regulated
banking institutions
and in many cases, incompatible reporting processes are found to be a
common obstacle to expanding its use in India.
The present competition and
growing MFI market without having a proper information sharing mechanism
among financial investors
typically leads to worsening of repayment performance and attracting anger from all quarters. Microfinance Institutions and financial investors, whose members
lack access to credit bureau in India goes on investing money with the existing gap in the sector and Inductus’s experience shows that if
microfinance credit bureaus developed by Inductus can be established
and used by MFIs and investors, the problems being observed in the sector can be easily neutralized.
How can the Microfinance Sector get Benefit from Inductus design Microfinance Credit Bureau Model?
F Best judgment can be made whether the perspective loan taker is taking the loan for consumption purpose or for investment one. Here, the loan asked for consumption purpose can be reduced so it will have a greater chance of the repayment. F The present concern of borrower’s suicide and misery can be reduced while not allowing the poor borrower to take credit from more than one MFI agencies. F More up to date information will improve portfolio management and diminished credit bureau and can also help reducing transaction costs.
F The quality data can permit microfinance institutions to start their business in the rural areas and take on riskier segment which in turn will improve potential clients and depth of outreach. F The proposed credit bureau will increase access to finance through improvement in portfolio management as it can generate more capital available for perspective clients. If clients are aware that their details are collected and all MFIs participate in the credit bureau, there are greater chances among credit takers to repay and maintain a positive credit history. F The bureau can help building up strong co-ordiantion among multiple service providers to create a more inclusive, streamlined financial sector environment n the area to forcefully implement "Know your customer" as an essential component of risk management practices. 
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Inductus Consultant |
