Which of the following committees was constituted to study the issues and concerns in the Micro Finance Institution in 2010?
Show answer & explanation
Correct answer: C
Explanation
The correct answer is option 3 i.e. Malegam Committee
- The Malegam Committee was crucial in addressing significant issues within the microfinance sector in India, aiming to improve the regulatory environment, protect borrowers, and ensure that MFIs operate transparently and ethically.
- The committee’s recommendations played a key role in shaping the future direction of microfinance regulation in India.
- Regulatory Framework: Establish a comprehensive regulatory framework specifically for MFIs, incorporating guidelines on capital adequacy, asset quality, and governance.
- Interest Rate Caps: Implement caps on the maximum interest rates that MFIs can charge, ensuring they remain affordable for borrowers.
- Client Protection: Strengthen client protection measures, including transparent disclosure of loan terms, fees, and charges.
- Data Sharing: Improve borrower data sharing among MFIs to prevent over-indebtedness and ensure responsible lending.