Mumbai: Reserve Bank of India (RBI) deputy governor K C Chakrabarty on Friday said the central bank has started discussion with all the stakeholders regarding implementation of the Malegam committee recommendations on microfinance.
“This (the Malegam report) is at the discussion stage... We have not decided anything yet,” Chakrabarty said.
“Some part of the report like interest rate will be applicable from 1 April,” he said.
RBI has already invited public comments on Malegam panel report, which suggested among other things capping interest rate at 24% for loans extended by microfinance institutions.
The committee, headed by Reserve Bank’s Central Board director Y H Malegam, suggested that small loans cannot exceed Rs 25,000 and creating of a separate category of non-banking financial companies (NBFC-MFI) for the MF sector.
RBI constituted the committee in October 2010 in the wake of allegations of overcharging and use of coercive recovery practices by MFIs that led to a spate of suicides in Andhra Pradesh.
The committee submitted its report on 19 January. These recommendations, the committee said, should be implemented from 1 April, 2011.