Speakers at a dialogue on microfinance Tuesday suggested greater transparency in terms of charges, terms and conditions in microfinance institutions to help the benefits of credit penetrate target groups.
They said the MFIs could introduce low cost systems to reduce the likelihood of client abuse and improve social performance.
Leading think-tank Centre for Policy Dialogue arranged the dialogue titled 'Microfinance for poverty alleviation: what's right and what's wrong' at the CIRDAP auditorium in Dhaka.
Bangladesh Bank governor Atiur Rahman attended the dialogue as chief guest while Palli Karma Shahayak Foundation chairman Qazi Kholiquzzaman and CPD executive director Mustafizur Rahman took part in discussion, which was chaired by CPD trustee board member Khushi Kabir.
David Hulme, head of the Institute for Development Policy and Management, University of Manchester, UK and Thankom Arun made a presentation titled 'What's Wrong and Right with Microfinance: Missing an Angle on Responsible Finance' during the dialogue.
Speaking as chief guest, the central bank governor said the relatively higher interest rates and charges/fees remain a persistent, biting criticism of microfinance, albeit more from populist political authorities rather than from actual borrowers.
He said regulators and government authorities could however encourage and support MFIs in minimising supervision costs, to the extent possible adopting remote loan delivery and recovery mechanisms in partnership with mobile phone companies and IT platforms offering card-based financial service delivery.
Source : New Age
