Microfinance institutions turn to background screening
The MFI industry, that has around 80,000-85,000 employees, was one of the sectors that did not consider background verification of employees an important factor in the recruitment process.
Moneycontrol | Saraswathy@maamitalks
The MFI industry, that has around 80,000-85,000 employees, was one of the sectors that did not consider background verification of employees an important factor in the recruitment process.
An Andhra Pradesh-based microfinance institution (MFI) recently decided to thoroughly screen all its sales-force after complaints of mis selling from rural customers. It now checks their previous employment records as well.
The MFI industry, that has around 80,000-85,000 employees, was one of the sectors that did not consider background verification of employees an important factor in the recruitment process. But companies have realised that this is crucial, especially because a majority of the staff members deal with cash.
But now these firms want to be safe than sorry. About 30 of them have tied-up with Equifax's India Workforce Solutions (IWS). IWS is a data repository, to which non-finance employment data is contributed directly by the Microfinance Institutions Network India (MFIN) members.
India Workforce Solutions enables instant employment verification to authorised users in a secure manner.
In an interaction with Moneycontrol, Nipa Modi, Country leader, Workforce Solution, Equifax India, said that their services complement the existing offering given by background screening firms.
She added that compared to a detailed screening of employment data that takes several weeks, this is real-time and user friendly.
"MFIs have a lot on feet-on-street. Their requirement is to ensure that none of these personnel have been involved in any fraudulent activity in the past, since these individuals will be required to handle cash," she said.
Modi said that sectors like BFSI, retail and IT have been using their services as of now. Next year, IWS will be extended to the pharma and FMCG sectors as well.
MFIN currently has 48 of the leading NBFC-MFIs in the country as its members. Once the data is contributed, members can then access this information for employment verification without the need for third parties, in a secure, confidential manner on a real time basis. The database will have Aadhaar or PAN as a unique identifier and will not include any negative reports about employees.
In the first stage, IWS will look at employment verification. This will then be extended to income verification. Currently, Modi said that employment-related discrepancy is the highest in India and hence their service will provide a safeguard against hiring of individuals who come into the system to commit fraud.
Click here to read more :- https://www.moneycontrol.com/news/business/companies/microfinance-institutions-turn-to-background-screening-4342851.html