Sa-Dhan, a microfinance network with 251 member organizations in India, has introduced a code of conduct in an effort to ensure borrowers are treated in an ethical way. The code, which was developed through consultation with microfinance institutions (MFIs), government representatives and a range of other stakeholders, consists of ten components: integrity & ethical behavior, transparency, fair practice, assessing need for financial services, appropriate interaction & collection practices, privacy of client data, governance, client education & financial literacy, competition, and feedback & grievance mechanisms [1]. The code of conduct also outlines the role of policy makers and the steps required for implementation including: the collection of data; analysis; capacity building workshops; enforcement; and integration with policies, training and MFI implementation [2].

The code of conduct is available for download at: http://www.sa-dhan.net/Resources/Sa-Dhan%20Code%20of%20Conduct%20final.pdf

By: Alexandra Pattee, Research Associate

About Sa-Dhan: Founded in 1999, Sa-Dhan is an Indian association of financial institutions that aims to build the field of community development finance in India. It aims to help its 251 member institutions serve low-income households in both rural and urban India. As of March 2010, Sa-Dhan reported serving 25.8 million clients through its member organizations, which hold an aggregate gross loan portfolio of INR 171 billion (USD 3.79 billion).

Sources and Resources:

[1] Microfinance Gateway, “Enabling Financial Inclusion: How Sa-Dhan Supports the Code of Conduct”, http://www.microfinancegateway.org/p/site/m/template.rc/1.9.50519/

[2] Sa-Dhan Website, “Core Values, Code of Conduct and Compliance Mechanism”, http://www.sa-dhan.net/Resources/Sa-Dhan%20Code%20of%20Conduct%20final.pdf

MicroCapital.org Article, April 5, 2011, “Fundacion Microfinanzas BBVA Launches Spanish-Language “Universal Code for Corporate Governance”, “Guide to Adopting Good Governance Principles” Targeted at Latin American Microfinance Sector”, http://www.microcapital.org/microcapital-brief-fundacion-microfinanzas-bbva-launches-spanish-language-?universal-code-for-corporate-governance?-?guide-to-adopting-good-governance-principles?-tar/

MicroCapital.org Article, April 5, 2011, “Smart Campaign Releases New Guidance Document, Proposed Revisions to “Client Protection Principles”", http://www.microcapital.org/microcapital-brief-smart-campaign-releases-new-guidance-document-proposed-revisions-to-client-protection-principles/

MicroCapital.org Article, August 5, 2010, “Sa-Dhan, a Microfinance Network in India, Launches Microfinance and Financial Inclusion Magazine “Micro Matters”", http://www.microcapital.org/microcapital-brief-sa-dhan-a-microfinance-network-in-india-launches-microfinance-and-financial-inclusion-magazine-?micro-matters?/

MicroCapital.org Article, March 25, 2010, “Outstanding Loan Volume by NGO Microfinance Institutions (MFIs) in India Doubled from 2008 to 2009″, http://www.microcapital.org/microcapital-brief-outstanding-loan-volume-by-ngo-microfinance-institutions-mfis-in-india-doubled-from-2008-to-2009/

MicroCapital’s Microfinance Universe: Sa-Dahn, http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Sa-Dhan

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