New Delhi, Oct. 9 -- India's microfinance sector must prioritise savings and insurance over credit to prevent recurring crises, Chief Economic Adviser V Anantha Nageswaran said, warning that excessive lending and mis-selling have contributed to repeated problems in the industry.

Speaking at Sa-Dhan's 21st Annual National Conference in New Delhi, Nageswaran said microfinance institutions need to move beyond lending and focus on building sustainable livelihoods and financial security for low-income households.

"I think even within the microfinance institutional space in this country, I know that there have been in the past microfinance institutions which have, using their connections with the families at the rural level, addressed livelih...