, as an autonomous apex institution, with the mandate of playing a proactive role of a " think - tank " of the banking system. the nibm is recognized by the university of pune as an approved centre for post - graduate research, and also by the department of scientific and industrial research, ministry of science and technology, government of india. joint indiainternational monetary fund ( imf ) training programme ( itp ) has been established recently at the nibm campus in pune. the reserve bank has sponsored and funded this collaboration. this is the seventh such facility of the imf institute in the world. a former governor of the reserve bank and at present the prime minister, professor manmohan singh, inaugurated the upgradation of the 50 year old bankers ’ training college into a centre for advanced financial learning, when he visited the reserve bank recently. the centre is in the process of taking a final shape with the help of a high powered advisory group. the reserve bank also promotes research by providing financial assistance under a scheme – the reserve bank ’ s endowment scheme – to various institutions for undertaking research and training in areas of interest to the reserve bank. the financial support is generally provided through corpus funds. at present, there are 21 corpus funds and the beneficiaries include several universities. the reserve bank funds several seminars / lectures by experts, including leading academics, most notable of them being a series of three memorial lectures and support to national level academic workshops / conferences. as a continuation of this process, and as a part of its capacity building and knowledge management initiatives, the reserve bank has recently signed a memorandum of understanding with the london school of economics and political science ( lse ), as one of the sponsors, for creating a lse india observatory and ig patel chair. currently, an eminent economist, lord nick stern, holds the chair. the lse india observatory co - ordinates india related research, policy development and teaching at the lse and is expected to emerge as a hub for academic collaboration with academic institutions in india, government agencies and corporate bodies. we, in the reserve bank, believe that this event reinforces our joint commitment to greater collaboration between our two countries, economies, financial sectors, central banks, and academia. i would like to conclude by expressing my gratitude to the university, in particular, vice chancellor professor fagoonie for his kind invitation to me, and honorary professor bheenick for making the conferment ceremony a very

among them, which may lead to delays in sanction, double financing, etc. the building up, and sharing, of credit information will help in enhancing synergies among the various institutions and also ensure avoidance of multiple financing and consequent over - indebtedness. in this context, let me add that as per credit information companies ( regulation ) act, 2005, nbfcs, as credit institutions, are required to be members of at least one credit information company ( cic ) ( currently there are four cics ). what is important is that credit data regarding all the borrowers should be furnished to the concerned cic accurately and timely and full use should be made of the database of cics while extending credit, to guard against adverse selection and over indebtedness. diversification it was observed that mfis found a few geographies more profitable than others and against conventional wisdom which advocates diversification, ran in droves to the same geographies with southern region showing significant concentration of shgs and mfis. excessive proliferation of entities in a few regions, led to immense, and, sometimes, unhealthy competition leading to perverse practices. it is now comforting to see that, learning from the recent episode, the mfis are reorganising themselves and are spreading into, hitherto, untapped regions. diversification helps not only mfis in withstanding any region specific shocks but also help customers at large, by spreading the microfinance across the country. improvising the business model – reducing costs microfinance is a labour intensive sector involving significant delivery costs. while the entities could build these costs into their services and charge the customer, which many in fact did, the more efficient way of protecting or increasing one ’ s margins is reducing the operational costs by enhancing efficiency and leveraging technology. mfis should not pass on their operational inefficiencies to clients in the form of prices that are far higher than they need to be. considering the profile of the borrowers who are poor, to whom even a small increase in rates could make a lot of difference, mfis should strive to build more cost effective and efficient delivery models to serve their clientele better. credit rating of mfis the rating of mfis assumes critical importance as mfis are sourcing financing from banks and other institutions. there are several mfis in the country and their rating helps the lend