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Sa-Dhan recognized as SRO for NBFC-MFIs

Sa-Dhan, a national level association of community development finance institutions, has recently been recognized as a Self-Regulatory Organization (SRO) for Non-Banking Financial Companies-Microfinance Institutions (NBFC-MFIs) by the Reserve Bank of India. Sa-Dhan will now develop and administer a code of conduct recognized by the RBI to ensure borrower protection and education and plan a grievance and dispute redressal mechanism for clients of MFIs. It will also monitor the microfinance sector to ensure they adhere to the regulatory framework put in place by RBI. The organziation believes this will streamline the microfinance sector towards responsible lending and client protection as the key to orderly growth. Brij Mohan, director on the board of Micro Rating International and Sa-Dhan, said the recognition by RBI is another major step for orderly growth of the microfinance sector. Jagadananda, chairman of Sa-Dhan, said the recognition is a sign of the trust and confidence reposed in Sa-Dhan and its members’ unique contribution in the social and financial up-liftment of the poor. Sa-Dhan has 242 members reaching out to 22 states (covering approx 33 million clients with gross loan outstanding of 33,000 crores) and includes MFIs (For Profit and Not for Profit), SHG promoting institutions (SHPIs), banks, rating agencies, capacity building institutions etc.

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