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srilawsby aturio
As enacted
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Part VI · Examination and Supervison of Licensed Microfinance Companies

16. Supervisory measures of the Board on licensed microfinance company

Official English translation. Where it differs from the Sinhala or Tamil text, the Act itself says which text prevails.

(1)

Where the Board, on a report made by the Director, is of the opinion that a licensed microfinance company –

(a)

is carrying on or is in the process of carrying on its business following unsound or improper financial practices which are detrimental to the interest of its depositors, creditors and other stakeholders; or

(b)

has contravened or failed to comply with any provisions of this Act or any direction, rule, order or requirement made or imposed thereunder, the Board may do any one or more of the following:–

(i)

direct such licensed microfinance company to cease any such practice;

(ii)

direct such licensed microfinance company to, forthwith or within such period as may be specified by the Board, comply with the provisions of this Act, direction, rule, order or requirement made or imposed thereunder which such microfinance company has failed to comply with;

(iii)

direct such licensed microfinance company to take necessary action to correct the negative conditions resulting from such practice or contravention;

(iv)

restrain any director, manager or controller of the licensed microfinance company from carrying out any function in or in relation to the microfinance company;

(v)

direct such licensed microfinance company to remove any director, manager or employee of the company within a specified period;

(vi)

reorganize the licensed microfinance company by arranging for the increase of its capital or reconstitution of the board of directors or both such measures;

(vii)

provide for such arrangements as are necessary for the amalgamation of the licensed microfinance company with another licensed microfinance company or any other institution that consents to such amalgamation;

(viii)

appoint a person to manage the affairs of such licensed microfinance company with a view to assuring proper conduct of the business of such licensed microfinance company;

(ix)

serve a notice in writing on such microfinance company requiring it to show cause within fourteen days from the date of the notice why a penalty should not be imposed on such company, and upon its failure to show cause within the time specified therefor or where the cause shown does not satisfy the Board, impose a penalty not exceeding rupees two hundred and fifty thousand payable within such period as may be specified by the Board.

(2)

Any person aggrieved with any order or direction issued or measure taken under subsection (1), may, before the expiry of thirty days from the date of the issue of such order or direction or the date of such measure taken, appeal in writing to the Board and the Board shall render its decision within sixty days of receipt of such appeal.

Part VII

Cancellation of the Licence and Winding Up of Licensed Microfinance Company

Read on from Part VII

Part VIII

Microfinance Non-Governmental Organizations

Read on from Part VIII

Part IX

Principles, Standards and Guidelines Laid Down by the Board

Read on from Part IX

Part X

Immunity from Prosecution

Read on from Part X

Part XI

General

Read on from Part XI

Schedules