The role of government in India's micro-finance industry
AbstractRecent events in India have brought a fresh focus upon the problem of regulation in the field of micro-finance. This paper delineates the three distinct aspects where government needs to play a role. The first is to protect the rights of the micro-borrower, the consumer of micro-financial services. The second is that of prudential oversight of risk-taking by firms operating in micro-finance, since this could have systemic implications. The third is a developmental role, emphasising scale-up of the micro-finance industry where the key issues are diversification of access to funds, innovations in distribution and product structure, and the use of new technologies such as credit bureaus, the UID and mobile-based payments. Each of these roles need to be placed in an existing or a new regulatory agency. There is a case for creating a new regulatory agency which unifies the consumer protection function across all financial products.
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Bibliographic InfoPaper provided by Indira Gandhi Institute of Development Research, Mumbai, India in its series Indira Gandhi Institute of Development Research, Mumbai Working Papers with number 2011-007.
Length: 48 pages
Date of creation: Mar 2011
Date of revision:
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More information through EDIRC
financial services distribution; consumer protection; credit bureaus; securitisation;
Find related papers by JEL classification:
- G20 - Financial Economics - - Financial Institutions and Services - - - General
- G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
- G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-04-09 (All new papers)
- NEP-MFD-2011-04-09 (Microfinance)
- NEP-REG-2011-04-09 (Regulation)
You can help add them by filling out this form.
Blog mentionsAs found by EconAcademics.org, the blog aggregator for Economics research:
- Interesting readings
by Ajay Shah in Ajay Shah's blog on 2011-08-21 05:29:00
- Interesting Readings for August 23, 2011
by Ajay Shah in Citizen Economists on 2011-08-23 16:40:50
- Difficulties with PFRDA's Draft Aggregator Regulations, 2014
by Ajay Shah in Ajay Shah's blog on 2014-07-02 04:43:00
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