The Malegam Committee Report of 2011 helped establish micro- finance as a legitimate asset class. 

After 10 years then, the Reserve Bank of India (RBI) had released its Consultative Document on Regulation of Microfinance in June 2021. 

About the committee: 

The Reserve Bank of India formed a sub-committee in order to study the Microfinance sector regulated by the bank. The Sub-Committee was under the chairmanship of Y.H. Malegam. 

The committee recommended certain conditions to be satisfied for NBFCs to be classified as NBFC-MFI: 

• Not less than 90% of NBFCs total assets (other than cash, money market instruments and bank balances) are in the nature of “qualifying assets.” 
• The income NBFC derives from other services is in accordance with the regulation specified on that behalf. 

Read more: A framework for microfinance regulation that would suit India