Sa-Dhan moots uniform tool for income assessment of microfinance borrowers

Says it has developed a credit assessment tool for supporting the sector in getting accurate income assessments

Sa-Dhan, a self-regulatory organisation in the microfinance sector, in its recommendations to the Reserve Bank of India (RBI), has asked the central bank to introduce a uniform mechanism for income assessment of the borrowers, which can be used by all the lenders in the space.

In its consultative paper last month, the RBI had said all regulated entities should have a board-approved policy in place enumerating the factors considered for the assessment of household income. Sa-Dhan has said it has developed a credit assessment tool for supporting the sector in getting accurate income assessments.

Many experts had said that it was a