Microfinance Institutions Network (MFIN), in association with SIDBI, Association of Small Finance Banks of India (ASFBI), Sa-Dhan and Finance Industry Development Council (FIDC), has released the fourth edition of the ‘Industry Code of Conduct’ (CoC).
Releasing the CoC at an online event, Sivasubramanian Ramann, Chairman & Managing Director, SIDBI, said, “For us to take microcredit to every unserved household in the country, we need all the regulated entities to unite with the single-minded objective of financial inclusion. The importance of following principles of customer protection while lending cannot be overemphasized. It is good to see that digital processes have also been covered by the CoC as now many processes are digital and microfinance institutions have to play a vital role in spurring entrepreneurship and inclusion.“
JP Sharma, Chief General Manager, Department of Regulation, RRBI, said, “The customer has always been at the core of RBI’s policies and it is especially pertinent for low-income households. Following the CoC in letter and spirit will not only ensure customer protection but also a disciplined approach to credit disbursement. The CoC will therefore be extremely critical in view of the role that the microfinance institutions are expected to continue to play in financial inclusion.”
Dr Alok Misra – CEO & Director MFIN said, “RBI’s harmonized regulations necessitated a revision of the CoC, which draws on regulation, past editions of code, global best practices like Universal Standards of Social Performance Management (USSPM), Client Protection Principles (CPP) and field understanding of SROs. The key pillars are: fair treatment, education and transparency, information and privacy, grievance redressal and employee engagement.“
Mahesh Thakkar, Director General, Finance Industry Development Council (FIDC), said: “It is a moment of pride for the sector when various microfinance lenders, including FIDC, come together and release this CoC. We all know that the Industry CoC plays an important role in promoting and advancing responsible lending practices in microfinance.”