An Economic policy and legal analysis of the Micro Finance Institutions (Development & Regulation) Bill, 2011

Shubho Roy, Renuka Sane and Susan Thomas
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Shubho Roy: Indira Gandhi Institute of Development Research

Indira Gandhi Institute of Development Research, Mumbai Working Papers from Indira Gandhi Institute of Development Research, Mumbai, India

Abstract: In response to the Second Micro Finance Crisis in Andhra Pradesh, which took place in October 2010, the Ministry of Finance has pro- posed a new Micro Finance Institutions (Development & Regulation) Bill. This paper undertakes a detailed analysis of the draft Bill in terms of both economic policy and law. This analysis reveals many weak links, including: a lack of clarity on the objectives of the Bill; an insufficient focus on protection of the rights of the micro-borrower; lack of clarity about the definition of thrift; the loss of accountability that comes with multiple regulatory agencies; concerns about the rule of law; and constitutional issues about powers of the Centre versus the State Government.

Keywords: microfinance; regulation; crisis resolution; consumer credit; consumer protection; regulatory objectives (search for similar items in EconPapers)
JEL-codes: G20 G21 G28 K12 K23 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2011-10
New Economics Papers: this item is included in nep-cis, nep-mfd and nep-reg
References: View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ind:igiwpp:2011-025

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