MICROCAPITAL BRIEF: Small Industries Development Bank of India (SIDBI) Sets Up a "Lenders' Forum" to Promote Responsible Practices Among Indian Microfinance Institutions

Several major lenders to microfinance institutions in India have agreed to set up a “Lenders’ Forum” to promote transparent, responsible and commercially sustainable industry practices and codes of conduct so as to better safeguard the interests of the unbanked who form their client base.

The forum will be led by the Small Industries Development Bank of India (SIDBI), an Indian government-owned bank providing credit to medium- and large-scale microfinance institutions. Initial members include ICICI Bank (formerly Industrial Credit and Investment Corporation of India), HDFC Bank, Union Bank of India, Industrial Development Bank of India (IDBI), Axis Bank, Rabo India, Royal Bank of Scotland (RBS), HSBC, IndusInd Bank and Syndicate Bank. According to a the press release, these lenders account for approximately 80 percent of all lending support to microfinance institutions (MFIs) in the country.

“Our goal is to make sure that India continues to be a global leader not just in terms of outreach, but in fact, leads the global industry on transparency, client protection, efficiency and good governance.” said N.K. Maini, Deputy Managing Director at SIDBI.

By Witt Gatchell, Research Associate

About Small Industries Development Bank of India (SIDBI):
The Small Industries Development Bank of India (SIDBI) was established by the Indian Parliament in 1990. It provides credit to medium- and large-scale microfinance institutions. SIDBI reports dispursements equivalent to USD 7.2 billion during the fiscal year ending March 2010. This amount has gone toward various ventures such as term loans, equity support and capacity building grants to microfinance institutions. SIDBI is listed on, but does not report data to, the Microfinance Information Exchange.

About ICICI Bank:
ICICI Bank Limited, a banking and financial services company in India, operates 2,035 branches and 5,518 ATMs in India and 18 other countries in Europe, Asia, the Middle East and North America. ICICI Bank offers personal banking, business and agricultural banking, investment banking, life and non-life insurance, venture capital and asset management services. As of March 31, 2010 ICICI Bank reports total assets of INR 3.64 trillion (the equivalent of USD 78.6 billion).

About Axis Bank:
Established in 1994, Axis Bank, formerly UTI Bank, is a financial services firm based in Mumbai, India. The bank changed in name in April 2007 to avoid confusion with another unrelated corporation with a similar name. As of March 2009, Axis Bank claimed net revenue of INR 137 billion (USD 2.93 billion) and a net income of INR 18.1 billion (USD 396 million).

Sources and Additional Resources:
[1] Press Release: “Microfinance sector comes together to promote responsible finance”
http://www.microfinancegateway.org/gm/document-1.9.47781/Sidbi_Press_Rel…

MicroCapital Universe: Small Industries Development Bank of India (SIDBI): https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Sma…

MicroCapital Universe: ICICI Bank:
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=ICI…

MicroCapital Universe: Axis Bank:
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Axi…

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