In what is being seen by the Indian microfinance industry as a first step towards a proper policy regulatory framework for the Indian
microfinance industry (MFIs),
the Reserve Bank of India on Friday announced the creation of a new category of
non-banking financial companies for MFIs. Reacting to the development, S. Viswanatha Prasad, co-founder of the Bellwether Microfinance Fund, the country's first microfinance investment fund, said: "While this was expected as per the
YH Malegam Committee recommendations, it is important as it in many ways signals the start of efforts at having a full regulatory framework for the Indian microfinance sector.''
While the much awaited microfinance Bill, still stuck at an inter-ministerial discussion stage, is yet to be tabled in Parliament, this step, experts feel, is in the right direction.
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