New Zimbabwe.com

Parliament’s public consultations on Micro Finance Bill begin Monday

By Alois Vinga


THE Micro Finance Amendment Bill’s countrywide public consultations are set to kick off Monday in four major cities in the country, a bulletin published by Parliament has revealed.

The consultations will be conducted by the Budget and Finance Committee from 8 to 11 April.

The Committee will be in Harare and Mutare on the 9th, Masvingo on the 10th and Bulawayo on the 11th of April.

“All those who will be putting on military, signs of ranks, flags or badges and political parties regalia will not have access to the public hearing,” the bulletin said.

The Bill was first gazetted in December 2018 and will amend the Micro Finance Act by reducing the variety of institutions that can carry on microfinance business under the Act.

Currently, the Act envisages four different types of microfinance institutions which are partnerships or companies engaged in money-lending or providing credit to or accepting deposits from small-scale businesses and members of lower-income groups.

It also recognises credit-only micro financiers, which are organisations that provide loans and credit to small-scale borrowers, deposit-taking micro financiers, which are organisations accepting deposits from small-scale businesses and members of lower-income groups.

Lastly, the Act recognises money-lenders who provide loans and credit but who are not micro -financiers.

In order to reduce confusion and overlapping, the Bill will amend the Act to recognise only two institutions: credit-only microfinance institutions which are companies providing loans and credit to small-scale borrowers and deposit-taking microfinance institutions which are companies that accept deposits from small-scale businesses and members of lower-income groups.

The Bill will also extend and strengthen the supervision that can be exercised over microfinance institutions.

The Bill will also extend the tenure of Micro-Finance Institutions (MFIS) licenses to a five-year period, removing perpetual registrations and renewals.

Currently, all institutions are registered for one calendar year only.

Under the new Bill, MFIs will apply at least three months before expiry of their registration and will be obliged to disclose any material changes in the particulars they gave the Registrar when they were granted registration or when their registration was last reviewed.