Major Departures of the New Micro-Finance Business Proclamation

Unlike mainstream financial institutions, microfinance institutions play an important role in providing access to finance for rural farmers, small businesses, and other people who are engaged in similar activities. Hence, it was necessitated to have a legal framework to govern this issue i.e., Proclamation No. 626/2009. However, for various reasons, the existing proclamation needs amendment and the lawmakers came up with a new proclamation, Proclamation No. 1164/2019 (‘the new proclamation’), which introduces some innovative concepts to the existing proclamation. Therefore, in this piece, I will display some of the fundamental issues that are introduced in the new amending Proclamation. 

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