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ShareMumbai: Twenty five microfinance institutions have formed a trust called Alpha, which will put together a credit bureau called High Mark dedicated to the microfinance sector.
Alpha is headed by Vijay Mahajan, chairman of BASIX, and P N Vasudevan managing director of Equitas Microfinance.
Suresh Gurumani, chief executive officer of SKS Microfinance, says, "We have invested in a credit bureau, along with 24 other MFIs, which together have about 70% of the total portfolio."
The non performing loans of MFIs are currently around 0.5-1.3% of their total disbursals.
The issuance of multiple loans by the same borrower is a growing concern among lenders. There has been a district in Andhra where people borrowed from MFIs giving loans at lower interest rate to pay of loans from bigger MFIs.
But it is not going to be an easy task to have a credit bureau for the sector dealing with large rural masses that are financially illiterate.
Gurumani says, "It is not going to be so simple. Here (in rural areas) people have no proper address or names written in one particular manner."
But industry experts say there is a dire need for a credit bureau for the sector as in certain pockets of India there is too much money chasing a few.
