India’s Bankers Institute of Rural Development (BIRD) has designed training modules specifically on microfinance given the recent developments in Andhra Pradesh and in the microfinance sector. As one of the country’s most reputable research and training institutes for agriculture and rural banking, it hopes to provide a greater amount of information to organizations involved in micro-lending activities. In the backdrop of microfinance institutions (MFI) coming under the Reserve Bank of India (RBI) scanner, India’s premier Bankers Institute of Rural Development (BIRD) is giving special emphasis to microfinance space in its training modules.
Besides, the financial sector players, including public and private sector banks, MFIs, regional rural banks (RRB) and cooperatives are seeking specialised training in microfinance space in the light of contemporary developments.

Lucknow-based, BIRD is the country’s premier institute for training, research and consultancy in agriculture and rural development banking. It is an autonomous Society promoted by National Bank for Agriculture and Rural Development (NABARD).

“Although, BIRD had always been dedicated to rural banking sector, of which microfinance has become an important part, the commercial banks have been demanding special training to their field officers in light of recent developments in the microfinance sector,” BIRD Director S K Chatterjee told Business Standard here.

He said the institute had framed 15 latest modules for purposes of training in rural banking, of which microfinance was a vital part. The sector had also been accorded priority in the syllabus committee meeting of BIRD, which offers one year PG Diploma in Rural Banking, besides several courses.

“We are in talks with Indira Gandhi National Open University (IGNOU) for accrediting our PG Diploma course and are hopeful of its materializing during 2011-12,” he informed.

“Our contemporary research paper on access to microfinance in Andhra Pradesh (AP) has been copiously quoted in the Malegaon committee report,” he added.

Microfinance sector had come under RBI lens after some farmers allegedly committed suicide in AP following coercive collection measures by certain MFIs. Later, the AP government regulated MFIs under Andhra Pradesh Micro Finance Institutions (Regulation of Money Lending) Act, which many felt had scuttled their growth prospects.

In October 2010, RBI instituted the Malegam panel to study the MFI sector in India and the need for regulation. It submitted its report last month, which is now in public domain.

The committee suggested clubbing MFIs under a new category of Non Banking Finance Companies (NBFC) as NBFC-MFI for regulation.

Meanwhile, BIRD organised a two-day 2nd National Seminar on Microfinance: Issues and Challenges, which concludes today. The various topics of deliberations between policy makers, academicians, bankers, NGOs and MFIs, included microfinance for agriculture; Self Help Group (SHG) Bank linkage programme; tribal economy and microfinance; and migrant workers.

Several research papers and case studies were presented in the seminar. Some participants suggested social audit of MFIs to corroborate their financial performance with actual benefit to society.