Category: Regulation

MICROCAPITAL BRIEF: Central Bank of Nigeria (CBN) Governor Mallam Sanusi Lamido Calls Islamic Finance “Dynamic and Competitive”

In a recent seminar aimed at promoting awareness of Islamic banking models, Central Bank of Nigeria (CBN) Governor Mallam Sanusi Lamido reportedly predicted that non-interest banking will make a major impact on the Nigerian economy. Continue reading

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MICROCAPITAL BRIEF: Microfinance Institutions in India’s Andhra Pradesh State Seek Government, Commercial Bank Assistance in Restructuring Loans

The Microfinance Institutions Network (MFIN), an association of 39 Indian microlenders, has reportedly approached the government of the Indian state of Andhra Pradesh with a proposal to ease repayment terms for distressed borrowers in return for simplifying government-mandated underwriting procedures. Continue reading

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MICROCAPITAL BRIEF: Supreme Court of India Sends SKS Back to Andhra Pradesh High Court to Challenge Microfinance (Regulation of Moneylending) Act of 2010

SKS Microfinance, an Indian microfinance institution (MFI), recently was directed by the Supreme Court of India, the country’s apex court, to plead its case against the enforcement of the Regulation of Microlending Act of the Indian state of Andhra Pradesh (AP), in front of the AP High Court, the state’s apex court. Continue reading

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MICROCAPITAL BRIEF: Brazilian Insurance Regulator Superintendencia de Seguros Privados (SUSEP) to Release Microinsurance Regulatory Framework

Superintendencia de Seguros Privados (SUSEP), Brazil’s insurance regulator, recently announced that it will release a framework for the regulation of microinsurance by the end of October [1]. Continue reading

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MICROCAPITAL BRIEF: Reserve Bank of India Requires Microfinance Institutions to Hold Loans for 9 Months Before Securitizing

The Reserve Bank of India (RBI), India’s central banking authority, has announced that lenders must follow new regulatory standards before securitizing their loans for sale to investors. Continue reading

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MICROCAPITAL BRIEF: Government of Botswana to Stop Facilitating Repayment of Microfinance Loans by Civil Servants

The government of Botswana has announced that it will cease acting as an intermediary between microfinance institutions (MFIs) and civil servants for the collection of microloans through the provision of “deduction-at-source” from public servants’ wages [1]. Continue reading

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MICROCAPITAL BRIEF: On Financial Access Initiative Website, Daniel Rozas Highlights Roles of Credit Bureaux, Smart Campaign, Local Regulations to Address Multiple Borrowing in Microfinance

In an article recently published on the website of the US-based Financial Access Initiative, Brussels-based microfinance consultant Daniel Rozas examines multiple borrowing and proposes several ways address the issue. Continue reading

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MICROCAPITAL BRIEF: Kredits Offers Microfinance Institutions “Multi-Jurisdictional Regulatory Compliance Software Solution” in Kazakhstan, Brazil, India, Madagascar

Kredits, a US-based technology provider to microfinance institutions (MFIs), recently announced that it is providing a “multi-jurisdictional regulatory compliance software solution” to unnamed MFI clients in Kazakhstan, Brazil, India and Madagascar.  The product is soon to be made available to additional countries in Southeast Asia and Africa [1]. Continue reading

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MICROCAPITAL BRIEF: Central Bank of Nigeria Approves New Capital Base Requirements for Microfinance Banks (MFBs), MFBs Await Capital Verification Results

The Central Bank of Nigeria (CBN), Nigeria’s central banking authority, has approved the new capital base requirements for microfinance banks (MFBs) as per the expectations reported in the MicroCapital story dated June 28. Continue reading

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MICROCAPITAL BRIEF: State Bank of Pakistan (SBP) Reduces Provision Requirements for Microfinance Loans

The State Bank of Pakistan (SBP) has withdrawn general provision requirements for loans extended by microfinance banks (MFB) that are secured against collateral. Continue reading

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MICROCAPITAL BRIEF: Dr Muhammad Yunus Suggests Microfinance “Misinterpreted” as Charity in the Arab World due to Outdated Regulation

Dr Muhammad Yunus, the founder of Bangladeshi microfinance institution (MFI) Grameen Bank, recently argued that the Arab world has “misinterpreted the system’s true principles” by operating it as a “charity affair” [1]. Continue reading

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MICROCAPITAL BRIEF: In Center for Financial Inclusion (CFI) Report, “Opportunities and Obstacles to Financial Inclusion,” Microfinance Stakeholders Cite Financial Education as Top Need

The Center for Financial Inclusion (CFI), an affiliate of US-based nonprofit ACCION International, recently released a report titled “Opportunities and Obstacles to Financial Inclusion”, that identifies client financial education as the top opportunity in the microfinance sphere [1]. Continue reading

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MICROCAPITAL BRIEF: Due Diligence Critical as Indian Banks Select Business Correspondents to Downscale to Microfinance, Opines Ramesh S Arunachalam

Indian rural finance practitioner Mr Ramesh S Arunachalam recently addressed the need for due diligence in the business correspondent (BC) model that the Reserve Bank of India (RBI), India’s central banking authority, adopted in 2010 to increase financial access for low-income people [1]. Continue reading

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MICROCAPITAL BRIEF: Consortium on Financial Systems and Poverty (CFSP) Researchers Posit Weak Financial Sectors in Developing Countries Encourage Microenterprises at Expense of Economic Growth

In a recent paper, “Finance and Development: A Tale of Two Sectors,” published in the academic journal American Economic Review, researchers affiliated with the US-based nonprofit Consortium on Financial Systems and Poverty (CFSP), conclude that poor access to financing opportunities in developing countries makes it harder for entrepreneurs to start large-scale businesses like manufacturing [1]. Continue reading

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MICROCAPITAL BRIEF: Ahmed El Bardai of Egyptian Microfinance Institution Reefy Predicts Boom in Lending to Small and Medium-Sized Enterprises to Boost National Economy

Mr Ahmed El Bardai, founder and chief executive of the Egyptian for-profit microfinance institution (MFI) Reefy, expects the country’s next government to focus on small and medium-sized enterprises (SMEs) to boost the economy that is facing a huge budget deficit and declining gross domestic product [1]. Continue reading

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MICROCAPITAL BRIEF: Bank of Ghana Issues New Licensing Regime to Regulate Microfinance Industry

In an attempt to improve regulation of microfinance institutions (MFIs) in the country, the Bank of Ghana (BoG), the central bank of Ghana, recently issued new operating rules and guidelines under the Non-bank Financial Institutions Act 2008. Among those being regulated are ‘susu’ companies, which are named after a traditional, informal means to save and borrow. Continue reading

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MICROCAPITAL BRIEF: Reserve Bank of India (RBI) Mandates Banks Open 25% of New Branches in Rural Areas; Banks May Offer Only Limited Financial Services

The Reserve Bank of India (RBI), the country’s central banking authority, recently published circulars that will require new and existing banks to open one quarter of new branches in towns with populations of less than 10,000 people in an effort to further the government’s financial inclusion agenda. Continue reading

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MICROCAPITAL BRIEF: Chuck Waterfield of MFTransparency Explores Ideas to Make Microfinance Prices More Transparent

Mr Chuck Waterfield, founder and CEO of MFTransparency (MFT), a US-based nongovernmental organization (NGO) that collects and publishes information on microcredit products and pricing, recently contributed to the CGAP (Consultative Group to Assist the Poor) blog to suggest ideas for regulations that could encourage more transparent pricing in microfinance [1]. Continue reading

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