As Shri Anand Sinha, my predecessor mentioned in April 2012, “In their eagerness to grow business, the institutions had given a go by to the conventional wisdom and good practices such as due diligence in lending and ethical recovery practices.
Over-indebtedness of the borrowers led to difficulties in repayments and the forced recoveries by some MFIs led to public uproar and the subsequent intervention by the state government”. Consequently, we also had to tighten our regulations on micro-finance, based on the Malegam Committee recommendations. BIS central bankers’ speeches  3  Regulating P2P Lending Platforms 20.