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The
microfinance sector in India and internationally has reached new
heights in terms of outreach, growth rates and attracts mainstream
capital. Hence it has become essential to demonstrate with robust,
objective, and comparable data the double bottom line of the
industry. This becomes increasingly relevant in the current context
when concerns are being raised on the increasing incidence of
multiple borrowing coupled with high levels of profitability and
valuations of MFIs. Interestingly, the same concerns are being
voiced in India by several important stakeholders.
The
international movement in the Social Performance space seeks to
address these issues and there has been significant development in
the process of identifying tools to measure poverty outreach,
transparency, and adherence to mission among others. There are clear
advantages in building upon the international social performance
work and tailoring it to the Indian microfinance sector, and to
begin the process of driving the adoption of these tools by Indian
MFIs in order to effectively address existing concerns and potential
future ones, as well as to move towards the active management of
social performance to ultimately serve the clients better. There
have been some industry efforts, which indicate the interests by the
networks / MFIs. This has gathered momentum. This indicates extent
of interest by the networks / MFIs. Hence, it is important for
various stakeholders to discuss the relevance of some of these
initiatives to India, and agree on common tools that are relevant to
the Indian industry.
In
order to gain further consensus and momentum on transparency on
responsible financial inclusion, a Round Table on Responsible
Financial Inclusion and Lending organized by the Michael & Susan
Dell Foundation (MSDF) and EDA Rural Systems in New Delhi on March
19th, 2010. The Round Table brought together key stakeholders from
the microfinance sector to review current risks in the sector, and
aimed to begin a process of working together as an industry to build
an inclusive and responsible microfinance sector. Key members of the
industry gave presentations highlighting current concerns and
emerging initiatives and diverse roles that need to be played by
various stakeholders to move the sector towards becoming an
established double and triple bottom line industry.
It
brings us great pleasure to share with you the Report on the Round
Table.
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