Myanmar Issues New Guidelines For Non-Banking Financial Institutions

On January 26, 2021, the Central Bank of Myanmar (CBM) published Notification 1/2021 in relation to non-banking financial institutions (NBFIs). This notification, which took immediate effect and has far-reaching implications for NBFI operations in Myanmar, applies to NBFIs wishing to conduct finance company business, leasing business, or factoring business, which are defined in the Financial Institutions Law (2016) (FIL) as follows:

• Finance company business is "business engaging primarily in financing the purchase of goods or services with funding other than deposits from the public." Interest would be charged on such finance.
• Leasing business is "the business of letting or sub-letting movable property on hire, regardless whether the letting is with or without an option to purchase the property." An obvious example would be vehicle leasing.