The Microcredit Regulatory Authority has primarily selected 705 new microfinance institutions for giving licence to run microfinance business in the country, MRA sources said.
‘More than 1,200 new institutions submitted applications for licence. But, we have primarily selected 705 institutions to provide them with conditional licences,’MRA executive vice-chairman Khandakar Muzharul Haque told New Age.
Operating microfinance business without MRA licence is illegal as per the MRA Act 2006, the sources said.
Currently there are 721 MFIs who are authorised by the MRA to do microfinance business with poor people in the country.
‘Now more institutions are approaching to operate the business as the demand for microfinance is rising in the country,’ Muzharul said.
‘At the same time, we have also strengthened our regulatory activity to monitor the sector to avoid any illegal activities in the microcredit sector,’ he said.
Between January 2012 and July 2013, the MRA cancelled licences of a total of 31 MFIs which failed to comply with the MRA rules.
‘MRA team during inspection found that the institutions neglected to follow MRA rules. So, we have cancelled their licences to stop their business in the country,’ Muzharul said.
Thirty-one MFIs which lost licences are Uttaran Paribar, Voluntary Association for Rural Development, Shapno Foundation, Society for Urban & Rural Emancipation, Village Economic And Social Development Community, Approach for Community Development Organisation, National Development Society, Foundation for Poor’s Progressive Programme, Social Economic & Moral Development, Pother Dishari Society, the Good Earth, NMN Foundation in Dhaka, Easo Kaz Kari in Panchagarh, Socio-Economic & Rural Advancement Association in Netrakona, Uzzibon Kallyan Sangstha in Chittagong, Chetona Samaj Kallyan Kendro in Shariatpur, Community Development Association in Dinajpur, Golden Way in Comilla, Welfare Efforts in Jhenaidah, Proshikkhan, Kaz, Samannay Sangstha in Gazipur, Daridra Nibaron Kendra in Sirajganj, North Bengal Rural Development Sangstha in Kurigram, Village Disability and Development Centre in Narshingdi, Social Organisation for Rural Development in Manikganj, Integrated Development Association of Bangladesh in Barisal, Gonamukti Sechchasebi Society in Khulna, Provati Samaz Kallyan Songstha in Jamalpur, Uzziban Samj Seva Sangstha in Rajshahi, Profullah Samajik Sangstha and Palli Neer Sangstha in Tangail and Jagorony Janakallyan Sangsth in Chapainawabganj.
Total outstanding loan in the microfinance sector is around Tk 24,800 crore and savings Tk 16,800 crore. The number of total clients in this sector is 35 million, MRA data shows.
Loan amounting up to Tk 50,000 is generally considered as microcredit while loan above the limit is considered as microenterprise loan.
-With New Age input
