Publication: Dvara Research

Almost 65% of India’s population lives in its rural areas.1 India’s financial sector has seen unprecedented expansion, driven by policy initiatives, digital infrastructure and regulatory reforms. Initiatives like Pradhan Mantri Jan-Dhan Yojana (PMJDY), Aadhaar-linked banking, Unified Payments Interface (UPI) and digital lending have significantly improved access to financial services, particularly for underserved segments.

This study sought to understand the impact of the new regulations on the microfinance sector through the lens of different categories of stakeholders – customers, leadership at microfinance institutions (MFIs) and intermediating staff.

The response presents our thinking on the governance of artificial intelligence (AI). It is divided into two parts. Part A summarises our key inputs which are also presented below in the form of this write-up. Part B provides a section-by-section paragraph-wise detailed feedback as per the Ministry’s Consultation Form requirements.

Mobile Instant Credit (MIC) is rapidly growing as a financial inclusion tool, attracting policy and research interest. However, its impact remains understudied, with a weak Theory of Change. The blog highlights three overlooked impact areas and calls for insights from microfinance research.

Debt distress among microfinance borrowers is on the rise, sufficiently so that it may be characterised as a crisis for the sector. This is driven by factors across the supply- and demand-sides, as well as factors inherent in the nature of the credit cycle, where periodic booms and busts have been present throughout history. To address this, we propose two sets of recommendations for the regulator: a set of recommendations that can be initiated in the short-term and another set that can be initiated over the medium-term.

In this blog, we will highlight some interesting facts about agricultural households from the survey through a set of questions that can help contextualise the financial lives of farmers and their families.

The Government of India called for pre-budget consultations in early January 2025. Dvara Research was one of the invitees, and we are once again grateful to policy makers for reposing trust in our work. In the past as well, Dvara Research has been a partner and advisor of choice for key policy-making bodies in the country.

In this blog, we will highlight some interesting facts about agricultural households from the survey through a set of questions that can help contextualise the financial lives of farmers and their families.

This blog presents key insights from the second round of the survey report, NAFIS 2021-22, and finds that the rural households’ investment portfolio continues to be dominated by physical assets, which is in contrast with the predominance of formal debt on the liabilities side of the household balance sheets.

According to a report by Crif High Mark, microfinance loans overdue for up to 31-180 days increased from 2.1% in March 2024 to 2.7% in June 2024. While there could be several supply-side factors at play for the rise in defaults, in this blog we direct our attention to reviewing the household side of the story by assessing the changes in household balance sheets post the COVID-19 pandemic.