CIBIL and 31 microfinance institutions associate to establish credit bureau

by BankBazaar.com Desk on 22, March, 2010   0 |

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Credit Information Bureau of India (CIBIL) has tied up with 31 major micro finance institutions (MFIs) of India to set up credit information bureau for MFIs. The MFIs form a portion of the Micro Finance Institutions Network (MFIN). MFIN has just been established as a regulatory authority of the MFIs.

Arun Thukral, Cibil’s Managing Director said, “The establishment of Micro finance Credit Information Bureau is a vital step towards inculcating financial discipline among the borrowers of micro-loans and will increase credit penetration”.

After the establishment of this bureau, the MFIs will get help in responsible lending and in judging the credit worthiness of the borrower, and consequently the risk profile of the borrower.

Quoting a CRISIL report, CIBIL said that the Indian microfinance sector has about 120 million households participating in it and this leads to a credit demand of Rs. 1.2 trillion.

Vijay Mahajan , Chairman MFIN said, “MFIs already serve over 25 million customers who have no documented credit history. The task of tracking the credit history of such large numbers is challenging. By supporting this initiative, Cibil will be participating in a nation-building effort”.

CIBIL presently has a database of more than 155 million records and a member base of over 200 financial institutions. The main shareholders of CIBIL comprise of SBI, HDFC, D&B and TransUnion.

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