Sri Lankan Govt to set up Microfinance Regulatory and Supervisory Authority

Microfinance Focus, July 24, 2010: At a recent Press Conference held at the Ministry of Mass Media and Information of Sri Lanka, the Cabinet Spokesman and the Minister of Mass Media and Information Keheliya Rambukwella announced that Cabinet of Ministers granted approval to instruct the Legal Draftsman to draft the Micro Finance Bill to set up the Microfinance Regulatory and Supervisory Authority.

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The proposed authority will be responsible to license/register, regulate and supervise institutions (Companies, Non-Governmental Organizations Co-operative Societies and societies which are registered under the Companies Act, Voluntary Social Service Organizations (Registration and Supervision) Act, that carry on the Microfinance business.

A report which was the results a nationwide survey of microfinance institutions undertaken by GTZ-ProMiS (Promotion of the Microfinance Sector), in Sri Lanka, published in the month of November 2009 found that The growth of microfinance in Sri Lanka is hampered by the lack of a coherent regulatory and supervisory framework, governance issues, lack of technology and shortage of skilled personnel.

The microfinance sector in Sri Lanka consists of a diverse range of institutions which do not fall under the purview of a single authority and there is currently no single and up-to-date database on these institutions, added by the report.

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