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FEATURES
It is an independent, third party comprehensive assessment of risk involved of underlying portfolio of MFI and its resultant social impact. Besides evaluating creditworthiness of MFIs, ratings also assess trustworthiness, operational excellence, quality of loans etc of a Micro Finance Institution, amongst other subjective parameters.
The assessment of MFIs also covers Financial, Operational, Management & Political risk and matters related to its internal governance, strategic positioning and social profile.
ADVANTAGES
Funding – SMERA MFI Rating is an important tool for banks, financial institutions and other market participants to undertake investment or funding decisions.
Data Validation- SMERA MFI Rating helps in validating data submitted to the investors / lenders.
Improve Management and Internal operations - It helps in optimizing and improving efficiency of the MFI.
Better Resource / Asset Allocation - It helps in efficient allocation of resource and assets on the basis of MFI rating.
Neutral Assessment - It is a third party neutral assessment of underlying risks involved in assessment of MFIs.
Benchmarking - Comparing performances with other MFIs.
RATING PROCESS
The filled application with relevant documents and the total rating fee To be forwarded to the SMERA office or the sales representative.
As a part of the evaluation exercise SMERA analyst will visit the MFI and Conduct the detailed discussions with the management and also undertake field visits.
Post field visit and assessment of various data collected, the Rating Committee would finalize the rating.
SMERA shall complete the evaluation exercise and provide Ratings to the MFI/Bank.
RATING SCALE
| Rating Scale |
Explanation |
| MF1 |
Highest |
| MF2 |
High |
| MF3 |
Above Average |
| MF4 |
Average |
| MF5 |
Below Average |
| MF6 |
Inadequate |
| MF7 |
Low |
| MF8 |
Lowest |
Rating Parameters
SMERA’s Rating Parameters for MFI Credit Ratings are categorized as under:
1. Business Orientation & Outreach
2. Management
3. Operational Efficiency and Risk Management
4. Portfolio Quality
5. Financial Performance
For more information please contact:
Sanjay Kher
National Sales Manager - Special Products
SME Rating Agency of India Ltd
Email - sanjay.kher@smera.in
Ph. - 022 2518 8108
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