Microfinance Institutions Network (MFIN), the industry body representing non bank finance companies and microfinance institutions (NBFC-MFIs), today said Reserve Bank-regulated NBFC-MFIs have no link with chit fund companies in any region, including Assam.
"On behalf of all its members, MFIN would like to clarify that no member NBFC-MFI has any linkage with chit funds. Our member MFIs are non-deposit taking entities that operate under a tight framework of regulations, as laid down by the Reserve Bank of India (RBI)," MFIN Chief Executive Officer Alok Prasad said in a statement.
"As institutions that primarily provide micro-credit to low income households, MFIs have a well defined role in the formal RBI regulated financial system."
Prasad said the recent incident involving Sharadha Group is a matter of concern and there is urgent need for a proper framework of regulations covering all types of institutions, irrespective of legal form.
All MFIN members are operating within the rules and regulations as laid down by the RBI.
MFIN is the premier industry association for the microfinance industry in India and its current membership consists of 44 NBFC-MFIs across the country.
