Sa-Dhan unveils Sankalp 3.0 to boost governance, risk in microfinance

Sa-Dhan launches Sankalp 3.0 guardrails to improve governance, risk management and customer protection in microfinance sector amid improving asset quality

Sa-Dhan, an RBI-recognised self-regulatory organisation (SRO) for the microfinance sector (MFI), on Friday released the third edition of its sectoral guardrails — Sankalp 3.0 — aimed at further strengthening governance standards and improving the implementation of regulatory practices across the industry.   Sankalp 3.0 places sharper emphasis on data-led decision-making, early risk identification, stronger governance frameworks, and customer-centric practices. The new set of guardrails comes in the wake of an improved situation in the microfinance sector with regard to collection efficiency and better asset quality. However, it was decided to continue the existing guardrails for some more time so that better recovery of the sector is possible.   Jiji Mammen, executive director and chief executive officer of Sa-Dhan, said, “The new guardrails focus on early identification of risks, stronger governance and deeper customer protection. Our aim is to ensure that the sector grows responsibly while continuing to serve its core purpose of financial inclusion. Sankalp 3.0 reflects the collective thinking of the industry and provides a practical roadmap for institutions to navigate current challenges with confidence.”   It was unveiled by Sa-Dhan at a conclave by Paul Thomas, chairman, Sa-Dhan, in the presence of its board members, senior representatives from the Reserve Bank of India, and key stakeholders including NBFC-MFIs, banks, small finance banks, and other industry participants in Mumbai.   Satish Marathe, member of the central board of the RBI, said that the RBI should consider constituting a steering committee for microfinance so as to have regular interactions and sort out any issues being faced.   K Paul Thomas, chairman of Sa-Dhan and managing director and chief executive officer of ESAF Small Finance Bank, said, “The microfinance sector has shown resilience over the years, but it must continue to evolve with changing realities. Sankalp 3.0 is an important step in strengthening the sector’s foundation. It brings together regulation, data, and industry experience to create a balanced framework for growth. By focusing on governance, transparency, and customer well-being, these guardrails will help build greater trust and long-term sustainability in the sector.”