The Microfinance Institutions Network (MFIN), a registered body of leading non-banking finance company-microfinance institutions, will soon apply to the Reserve Bank of India to be recognised as the first self-regulatory organisation (SRO) in the industry.

“We have amended some of our bylaws in line with the requirements to be recognised as an SRO and will be moving the application to the RBI in about a week,” Alok Prasad, Chief Executive Officer of MFIN, told Business Line on Wednesday.

About six weeks ago, the apex bank had released the guidelines for self-regulation by MFIs which is an important aspect of the recommendations of the Malegam panel on regulatory reforms in the microfinance sector.

It may be recalled that the committee was set up by the RBI after the Andhra Pradesh microfinance crisis, following allegations of harassment of clients by recovery agents of MFIs. To be recognised as an SRO, an industry body should have independent directors comprising at least a third of its board, and representation of both small and large micro-lenders on the governing council. It should also have a compliance officer who is employed and paid by the SRO, but is directly responsible to the RBI.

At the extraordinary general body meeting held here on Tuesday, MFIN members had agreed for changes in the bylaws accordingly, he said. “If we can get the recognition from the RBI, it will be a good leap of faith for the microfinance industry which faced many allegations,” Prasad said.

Growth On the state of the industry, he said loans outside Andhra Pradesh were growing. “By March 31, 2014, we expect the gross loan portfolio to be about Rs 33,000 crore, which will mean 55 per cent growth compared to last year,” he added.

This is the first time that micro-lenders are expecting growth to surpass the gross loan size of Rs 27,000 crore, which was the peak achieved before the 2010 crisis.

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