Amendment To The Microfinance Act

A Glimpse on the Microfinance Amendment Act.

Finally the much awaited perpetual license was promulgated. However, the new section 10A proves some elements of poor drafting as it speaks of renewal terms which were taken away by the perpetual licensing. It can not overemphasized that perpetual licensing will attract investment in the sector as it brings confidence to the investors. It was difficult to bring millions against an annual license!

The introduction of the Advisory Council is very much commendable as it brings together the government, private players and civic organizations to work together in sharing ideas for the growth of this industry.

Corporate governance was strengthened although the idea of having other directors being spared from liability on the acts done by the company simply because they had a descending position is subject to test by reality.