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srilawsby aturio
As enacted
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Part V · Microfinance Business

33. Specific directives for microfinance institutions

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

(1)

The Authority may, without prejudice to the provisions of subsection (1) of section 37 and after having due consultations, issue directives to microfinance institutions or to any single microfinance institution or to any group or category of microfinance institutions regarding –

(a)

the terms and conditions under which deposits may be accepted as collateral by such microfinance institution, the maximum rates of interest payable on such deposits, the maximum period for which deposits may be accepted and the maximum amount that may be deposited with an institution by a customer;

(b)

the terms and conditions under which investments may be made and the maximum permissible maturities of such investments;

(c)

the establishment of a reserve fund, minimum percentage of annual after tax profit that shall be transferred to such fund and other operational aspects of such fund;

(d)

the minimum capital requirement; and

(e)

the minimum ratio of the outstanding accommodation granted to low - income persons and to micro enterprises by a microfinance institution shall bear to the outstanding accommodation granted by such microfinance institution.

(2)

Any microfinance institution that fails to comply with any directive issued under subsection (1) may be required to pay an administrative charge as may be determined by the

Authority not exceeding rupees two million.

(3)

When issuing directives under subsections (1), the

Authority shall ensure the proportionality of the directive to the relevant microfinance institution, in view of the relevant considerations including the asset size, liabilities, market share and market conditions:

Provided that, the Authority shall apply an objective and verifiable criteria when assessing the proportionality of the directive.

Part VI

Regulation of Moneylenders and microfinance institutions

Read on from Part VI

Part VII

Examination of A Licencee

Read on from Part VII

Part VIII

Customer Protection

Read on from Part VIII

Part IX

Investigation of Offences

Read on from Part IX

Part X

Offences and Penalties

Read on from Part X

Part XI

Finance

Read on from Part XI

Part XII

General

Read on from Part XII

Part XIII

Transitional Provisions

Read on from Part XIII

Schedules