Laws of Uganda ActiveThe Micro Finance Deposit-Taking Institutions (Amendment) Act, 2023
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THE REPUBLIC OF UGANDA
THE MICRO FINANCE DEPOSIT-TAKING INSTITUTIONS (AMENDMENT) ACT, 2023
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THE REPUBLIC OF UGANDA
I SIGNIFY my assent to the bill.
(Signature)
President
Date of assent: 16th May, 2023
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Micro Finance Deposit-Taking Institutions
(Amendment) Act
Act 2023
THE MICRO FINANCE DEPOSIT-TAKING INSTITUTIONS
(AMENDMENT) ACT, 2023
ARRANGEMENT OF SECTIONS
Section
1. Amendment of Act No. 5 of 2003
2. Amendment of section 4 of principal Act
3. Amendment of section 7 of principal Act
4. Insertion of section 9A in principal Act
5. Amendment of section 18 of principal Act
6. Amendment of section 19 of principal Act
7. Insertion of Part IIIA and Part IIIB in principal Act
8. Amendment of section 21 of principal Act
9. Amendment of section 22 of principal Act
10. Insertion of section 22A in principal Act
11. Amendment of section 24 of principal Act
12. Amendment of section 25 of principal Act
ct
10. Insertion of section 22A in principal Act
11. Amendment of section 24 of principal Act
12. Amendment of section 25 of principal Act
13. Amendment of section 26 of principal Act
14. Amendment of section 27 of principal Act
15. Amendment of section 28 of principal Act
16. Amendment of section 32 of principal Act
17. Amendment of section 33 of principal Act
18. Amendment of section 34 of principal Act
Act
16. Amendment of section 32 of principal Act
17. Amendment of section 33 of principal Act
18. Amendment of section 34 of principal Act
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Micro Finance Deposit-Taking Institutions
(Amendment) Act
Act 2023
Clauses
19. Amendment of section 35 of principal Act
20. Amendment of section 40 of principal Act
21. Amendment of section 43 of principal Act
22. Amendment of section 46 of principal Act
23. Amendment of section 52 of principal Act
24. Amendment of section 57 of principal Act
25. Amendment of section 59 of principal Act
26. Amendment of section 60 of principal Act
27. Amendment of section 61 of principal Act
28. Amendment of section 68 of principal Act
29. Amendment of section 70 of principal Act
30. Amendment of section 74 of principal Act
31. Amendment of section 81 of principal Act
32. Amendment of section 83 of principal Act
33. Amendment of section 84 of principal Act
34. Amendment of section 88 of principal Act
Amendment of section 83 of principal Act
33. Amendment of section 84 of principal Act
34. Amendment of section 88 of principal Act
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Act Micro Finance Deposit-Taking Institutions
(Amendment) Act 2023
THE REPUBLIC OF UGANDA
THE MICRO FINANCE DEPOSIT-TAKING INSTITUTIONS
(AMENDMENT) ACT, 2023
An Act to amend the Micro Finance Deposit-Taking Institutions
Act, 2003; to provide for Islamic banking; to provide for
bancassurance; to provide for agent banking; to provide for
special access to the Credit Reference Bureau by other accredited
credit providers and service providers; and for related purposes.
Date of Assent:
Date of Commencement:
BE IT ENACTED by Parliament as follows:
1. Amendment of Act No. 5 of 2003
The Micro Finance Deposit-Taking Institutions Act, 2003, in this Act
referred to as the principal Act, is amended in section 2—
t of Act No. 5 of 2003
The Micro Finance Deposit-Taking Institutions Act, 2003, in this Act
referred to as the principal Act, is amended in section 2—
(a) by inserting the following appropriately—
““agent” means an entity contracted by an institution
and approved by the Central Bank to provide
microfinance deposit taking services on behalf of
that institution;
“branch” means a place of business which forms a
dependent part of a microfinance institution and
which conducts all or some of the operations inherent
in the business of that microfinance institution;
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Micro Finance Deposit-Taking Institutions
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2023
Micro Finance Deposit-Taking Institutions
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“compulsory savings” means monies that shall be
contributed by a borrower as a condition for
receiving a loan or other credit;
“islamic contract” means a contract designed to comply
with the Shari’ah and which satisfies conditions
specified by the Central Bank for purposes of
complying with the Shari’ah;
“islamic microfinance business” means—
(a) the business of receiving money into profit
sharing investment accounts or of managing
those accounts;
(b) the business of providing finance; whether
through the acquisition, disposal or leasing
of assets or otherwise; or other services
which have a similar economic effect or are
otherwise economically equivalent to any
other microfinance business; or
(c) any other microfinance business which
involves or is intended to involve entering
into Islamic contracts, or which is otherwise
carried out or purported to be carried out in
accordance with the Shari’ah;
ring
into Islamic contracts, or which is otherwise
carried out or purported to be carried out in
accordance with the Shari’ah;
“Islamic microfinance institution” means a company
licensed to carry on microfinance business, whose
entire business comprises of Islamic microfinance
business and which has declared to the Central
Bank that its entire operations are to be conducted in
accordance with the Shari’ah;
“islamic window” means the part of a microfinance
institution, other than an Islamic microfinance
institution, which conducts Islamic microfinance
business;
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"place of business" means any premises at which an
institution transacts microfinance business in
Uganda and which is open to the public and includes
a branch, an agent, a mobile unit, or such other
premises as may, from time to time, be prescribed
by the Central Bank;
"profit sharing investment account" means an account
managed by a microfinance deposit-taking
institution—
(a) in relation to property of any kind, including
currency specified in this Act, held for or
within the account;
(b) as part of its Islamic microfinance business;
and
currency specified in this Act, held for or
within the account;
(b) as part of its Islamic microfinance business;
and
(c) under the terms of an agreement where—
(i) the account holder agrees to share any
profit with the microfinance deposit-
taking institution as a manager of the
account in accordance with a pre-
determined specified percentage or
ratio; and
(ii) the account holder agrees that he or she
alone will bear any losses in the absence
of negligence or breach of contract on
the part of the microfinance bank;
"related interest" means the business interests of affiliates,
associates and their related persons;
"Shari’ah advisory board" means a board established in
accordance with section 20B;
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“significant shareholder” means a shareholder holding five percent or more of the allotted shares of an institution;”;
(b) by substituting for the definition of “credit facilities”, the following—
““credit facility” means—
of the allotted shares of an institution;”;
(b) by substituting for the definition of “credit facilities”, the following—
““credit facility” means—
(a) an institution granting an advance, loan or other facility in which a customer of the institution has access to funds or financial guarantees; including any economically equivalent arrangement in connection with Islamic microfinance business; or
(b) an institution incurring a liability on behalf of a customer;”;
(c) by substituting for the definition of “deposit”, the following—
““deposit” means a sum of money received or paid on terms under which it will be repaid, either on demand or at a time or in circumstances agreed upon by or on behalf of the person making the payment and the person receiving it, with or without interest, premium or other economic return, except that the following shall not qualify as deposits—
(a) any sum of money which is paid by way of advance or part payment under a contract for the sale, hire or other provision of property or service, where the sum is repayable only if the
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property or service is not in fact sold, hired or
otherwise provided;
(b) a sum of money which is paid by way of
security for performing a contract; or
(c) a sum of money which is paid as security for
a credit facility which has been advanced or
granted to any person making the payment,
except that such sum or interest on it shall not
be on-lent;";
(d) by substituting for the definition of "group guarantee", the
following—
""group guarantee" means a guarantee mechanism
including any economically equivalent arrangement
relating to Islamic microfinance business by which
a group of borrowers undertake to be liable jointly
or severally for a loan or any other credit facility of
any one of them;";
be liable jointly
or severally for a loan or any other credit facility of
any one of them;";
(e) by substituting for the definition of "loan insurance fund",
the following—
""loan insurance fund" means a fund consisting of
contributions of group customers of an institution to
act as collateral for a credit facility;";
(f) by substituting for the definition of "manager", the
following—
""manager" means an officer of a microfinance deposit-
taking institution who directs, controls or influences
the decision-making of the institution;".
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(g) by substituting for the definition of "microfinance
business", the following—
""microfinance business" means the business of—
he definition of "microfinance
business", the following—
""microfinance business" means the business of—
(a) acceptance of deposits from members of the
public by any person or institution, regardless
of the business form, whether licensed by
Central Bank or not;
(b) employing deposits, wholly or partly, by
lending or extending credit for the account
and at the risk of the person accepting those
deposits, including the provision of short-
term loans or other credit to small or micro
enterprises and low-income households,
usually characterized by the use of collateral
substitutes, such as group guarantees or
compulsory savings;
(c) engaging in Islamic microfinance business;
or
compulsory savings;
(c) engaging in Islamic microfinance business;
or
(d) transacting such other activities as may
be prescribed by the Central Bank by
regulations made under section 89 of this
Act;";
(h) by substituting for the definition of "non-performing
loan", the following—
""non-performing loan" means a loan or other credit
facility or asset in respect of which the principal,
interest or other payment has been due and unpaid
for a period specified in the Regulations, or where
the principal or interest payment is overdue and has
been capitalised;".
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(i) by substituting for the definition of “reputable financial
institution”, the following—
2023
(i) by substituting for the definition of “reputable financial
institution”, the following—
““reputable financial institution” means a financial
institution licensed to conduct banking or other
financial institution business under the laws of
any other country or territory and which meets the
criteria prescribed by the Central Bank;”;
(j) by substituting for the definition of “short-term loan”, the
following—
““short-term credit facility” means a loan or other credit,
for which the period for repayment does not exceed
two years;”;
(k) by substituting for the definition of “small loan”, the
following—
““small credit” means a loan or other credit which is less
than one percent of the core capital prescribed in
this Act in the case of individual borrower; and five
percent of the core capital prescribed in this Act in
the case of a group borrower;”;
(l) by numbering the current section as subsection (1) and
inserting immediately after the provision, the following—
a group borrower;”;
(l) by numbering the current section as subsection (1) and
inserting immediately after the provision, the following—
“(2) A reference to loans or credit, lending,
extension or provision of credit, credit accommodation or
such similar terms, or to any instrument in that respect,
collectively referred to as “credit provision” shall apply
to—
(a) any finance arrangement which satisfies the
following conditions—
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(i) the arrangement provides for a person who is
the financier to pay a sum of money to another
person who is the customer;
(ii) the arrangement identifies assets, or a class of
assets, which the customer acquires;
(iii) the arrangement specifies a finance term
which shall be the period at the end of which
the arrangement shall cease to have effect;
which shall be the period at the end of which
the arrangement shall cease to have effect;
(iv) the customer undertakes, under the
arrangement, to make a payment in respect
of the capital to the financier during or at
the end of the finance term, whether in
instalments or not and to pay to the financier
other payments on one or more occasions
during or at the end of the finance term; and
(v) the arrangement satisfies such other conditions
as may be specified by the Central Bank by
regulations;
(b) any finance arrangement other than the finance
arrangement referred to in subsection 2 (a) which
satisfies the following conditions—
he finance
arrangement referred to in subsection 2 (a) which
satisfies the following conditions—
(i) the arrangement provides for a customer to
make a payment in respect of capital to the
financier to purchase, lease, hire or otherwise
acquire or use assets which are identified;
(ii) the financier agrees to sell, lease, hire or
otherwise dispose of or allow the use of assets
or classes of assets to a customer or to pay a
sum of money to another person;
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Act Micro Finance Deposit-Taking Institutions
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(c) any other provision of finance including through
the acquisition, disposal or leasing of assets that is
economically equivalent to credit provision.
hrough
the acquisition, disposal or leasing of assets that is
economically equivalent to credit provision.
(3) In this Act, unless the context otherwise requires, a
reference to guarantees or similar terms or a reference to any
instrument in respect of guarantees or similar terms, in the
Act referred to collectively as a “guarantee provision”, shall
be interpreted to apply to any arrangement which satisfies the
following conditions—
(a) the arrangement is economically equivalent to a
guarantee provision; and
(b) the arrangement satisfies such conditions as may be
specified by the Central Bank by regulations.”
2. Amendment of section 4 of principal Act
Section 4 of the principal Act is amended by inserting immediately
after subsection (1), the following—
“(1a) A person licensed to carry out microfinance business may
carry out the licensed business through an agent.
“(1a) A person licensed to carry out microfinance business may
carry out the licensed business through an agent.
(1b) The Central Bank shall, in consultation with the Minister,
make regulations in respect of agents and agent banking.”
3. Amendment of section 7 of principal Act
Section 7 of the principal Act is amended in subsection (1)—
(a) by substituting for paragraph (a), the following—
“(a) a copy of the memorandum and articles of association
or other instrument under which the company is
incorporated, the certificate of incorporation and,
in the case of a person intending to conduct Islamic
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microfinance business, a statement stating that the
business of the institution shall be conducted in
accordance with the Shari'ah;";
, a statement stating that the
business of the institution shall be conducted in
accordance with the Shari'ah;";
(b) by inserting immediately after paragraph (h), the
following—
"(i) such other information as the Central Bank may, by
regulations, specify."
4. Insertion of section 9A in principal Act
The principal Act is amended by inserting immediately after section
9, the following—
"9A. Duration and display of licence
(1) A licence granted under section 7 shall remain valid
unless it is revoked.
(2) A licence granted under section 7 shall be displayed
in its original form, in a conspicuous place, in the premises in
which the institution carries on its lawful business and copies of
it shall be similarly displayed in each of the branch offices of the
institution."
5. Amendment of section 18 of principal Act
Section 18 of the principal Act is amended in subsection (1) (a) (i), by
substituting for the word "one", the word "two".
6. Amendment of section 19 of principal Act
Section 19 of the principal Act is amended—
by
substituting for the word "one", the word "two".
6. Amendment of section 19 of principal Act
Section 19 of the principal Act is amended—
(a) by substituting for paragraph (g), the following—
"(g) taking deposits or funds or other property into
sharing investment accounts and lending in foreign
exchange;";
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(b) in paragraph (i), by inserting immediately after the word
"loan", the words "or other credit facility"; and
(c) by substituting for paragraph (j), the following—
"(j) dealing in derivatives including, to any Islamic
contract or combination of contracts are economically
equivalent to derivatives."
7. Insertion of Part IIIA and Part IIIB in principal Act
The principal Act is amended by inserting immediately after Part III,
the following—
"PART IIIA—ISLAMIC BANKING
The principal Act is amended by inserting immediately after Part III,
the following—
"PART IIIA—ISLAMIC BANKING
20A. Licensing of institutions to conduct Islamic
microfinance business
(1) An institution carrying on microfinance business at
the commencement of this Act may apply to the Central Bank for
a licence to carry on Islamic microfinance business in addition to
its licensed microfinance business.
(2) An institution licensed to carry out Islamic
microfinance business under subsection (1), shall carry out that
business through an Islamic window.
(3) The Central Bank shall, in consultation with the
Minister, by statutory instrument, make regulations for the
licensing and operation of Islamic banking.
20B. Shari'ah Advisory Board
(1) Every institution which conducts Islamic
microfinance business shall appoint and maintain a Shari'ah
Advisory Board.
ution which conducts Islamic
microfinance business shall appoint and maintain a Shari'ah
Advisory Board.
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(2) A Shari'ah Advisory Board appointed by an
institution under this Act shall advise, approve and review the
activities of an Islamic financial business in order to ensure that
the institution complies with the Sharia'h.
(3) The Central Bank, in consultation with the Minister,
shall make regulations in respect of Shari'ah Advisory Boards
including—
(a) the size, functions, duties and responsibilities,
governance and conduct of Shari'ah Advisory
Boards;
(b) the competency, interests and terms of engagement
of members of Shari'ah Advisory Boards; and
(d) policies, procedures, record-keeping, reviews,
reporting and disclosure.
(4) The appointment, maintenance, operation and
conduct of a Shari'ah Advisory Board shall at all times be carried
out in accordance with the applicable rules and policies of the
institution and shall be answerable to the board of directors of
that institution.
ied
out in accordance with the applicable rules and policies of the
institution and shall be answerable to the board of directors of
that institution.
PART IIIB—CONDUCT OF BANCASSURANCE BY
MICRO FINANCE DEPOSIT — TAKING INSTITUTIONS
20C. Engaging in bancassurance business
(1) An institution shall not engage in insurance business,
bancassurance or Islamic insurance business in Uganda as a
principal or agent without the prior written authorisation of the
Central Bank.
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(2) An institution shall engage in the business of
bancassurance, insurance or Islamic insurance in a form and
manner prescribed by the Insurance Regulatory Authority of
Uganda, in consultation with the Central Bank.
(3) Subject to subsections (1) and (2), the bancassurance,
insurance or Islamic insurance business activities of an institution
shall comply with the Insurance Act, 2017.
(4) For the purposes of this section, "bancassurance"
means using an institution and its branches, sales network and
customer relationships to sell insurance products."
es of this section, "bancassurance"
means using an institution and its branches, sales network and
customer relationships to sell insurance products."
8. Amendment of section 21 of principal Act
Section 21 of the principal Act is amended—
(a) in subsection (4), by substituting for the word "ten", the
word "five";
(b) in subsection (5), by substituting for the word "ten", the
word "five"; and
(c) by inserting immediately after subsection (6), the
following—
"(7) A significant shareholder of an institution
shall not participate in the day to day management of an
institution."
9. Amendment of section 22 of principal Act
Section 22 of the principal Act is amended by inserting immediately
after subsection (2), the following—
"(3) A director serving on the board of an institution shall
hold office for a term of five years, renewable once."
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10. Insertion of section 22A in principal Act
The principal Act is amended by inserting immediately after section
22, the following—
2023
10. Insertion of section 22A in principal Act
The principal Act is amended by inserting immediately after section
22, the following—
“22A. Board Audit Committee
(1) There is established a Board Audit Committee
comprised of three independent non-executive directors who are
persons of proven integrity.
(2) The Board Audit Committee shall serve for a term of
three years, renewable once.”
11. Amendment of section 24 of principal Act
Section 24 of the principal Act is amended—
(a) in subsection (1), by substituting for paragraph (c), the
following—
“(c) ensuring that the business of an institution is in
compliance with all applicable laws and regulations,
and, in the case of an institution that conducts
Islamic microfinance business, that the business of
the institution complies with the Shari’ah, and is
conducive to safe and sound banking practices;”;
(b) by substituting for subsection (2), the following—
the Shari’ah, and is
conducive to safe and sound banking practices;”;
(b) by substituting for subsection (2), the following—
“(2) For the purposes of this Act, “corporate
governance” includes the overall environment in which an
institution operates, comprising a system of checks and
balances which promotes a healthy balancing of risk and
return, and, in the case of an institution which conducts
Islamic microfinance business, promotes compliance with
the Shari’ah.”
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12. Amendment of section 25 of principal Act
Section 25 of the principal Act is amended in subsection (2) —
(a) in paragraph (c), by inserting immediately after the word
“kind”, the words “or any transfer or delivery of any
asset.”;
(b) by inserting immediately after paragraph (c), the
following—
“(d) the institution does not, or may not be able to meet
its capital requirements as prescribed by this Act.”;
following—
“(d) the institution does not, or may not be able to meet
its capital requirements as prescribed by this Act.”;
(c) by inserting immediately after subsection (3), the
following—
“(4) An individual director who intends to report to
the Central Bank in accordance with subsection (2), shall
make his or her intention known to the board in writing,
prior to reporting to the Central Bank.
(5) Where the board of directors or a director
fails to report to the Central Bank any matter required to
be reported under subsection (2), the Central Bank may
withdraw its approval of—
(a) the board of directors as an organ; or
(b) an individual director.”
13. Amendment of section 26 of principal Act
Section 26 of the principal Act is amended in subsection (4) by
substituting for the word “two”, the words “at least half of the”.
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14. Amendment of section 27 of principal Act
Section 27 of the principal Act is amended—
(a) by substituting for the head note the fol1owing—
14. Amendment of section 27 of principal Act
Section 27 of the principal Act is amended—
(a) by substituting for the head note the fol1owing—
“27. Other staff of the institution”;
(b) by substituting for subsection (2), the following—
“(2) The officers referred to in subsection (1) shall
include a finance manager who shall have the following
duties—
(a) perform such functions as the board of directors
shall specify in relation to establishing
guidelines for the institution’s tolerance for
risk, and expectations from investment; and
(b) introduce such measures as, in his or her
opinion, may serve to enhance the credibility
and objectivity of financial statements and
reports prepared with reference to the affairs
of the institution.”; and
(c) in subsection (3), by substituting for paragraph (a) and (b)
the following—
“(a) limits on loan or other credit facility to deposit ratio;
(b) limits on loan or other credit facility to capital ratio;”.
15. Amendment of section 28 of principal Act
Section 28 of the principal Act is amended in subsection (2)—
other credit facility to capital ratio;”.
15. Amendment of section 28 of principal Act
Section 28 of the principal Act is amended in subsection (2)—
(a) by repealing the word “and” appearing at the end of
paragraph (f);
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(b) by substituting for paragraph (j), the following—
"(j) review, evaluate and approve the internal control
procedures and other systems;"; and
(c) by inserting immediately after paragraph (m), the
following—
"(n) any other duties as the Central Bank may
specify by regulations; and
(o) any additional duties as the board of directors
of an institution or its committee may specify."
16. Amendment of section 32 of principal Act
Section 32 of the principal Act is amended by inserting immediately
after subsection (2), the following—
"(3) An institution which contravenes subsection (1) is
liable to a civil penalty of two hundred currency points."
17. Amendment of section 33 of principal Act
Section 33 of the principal Act is amended by inserting immediately
after the words "commencement of", the words “and during the entire
duration of”.
18. Amendment of section 34 of principal Act
Section 34 of the principal Act is amended by substituting for the word
"three", the word “four”.
n of”.
18. Amendment of section 34 of principal Act
Section 34 of the principal Act is amended by substituting for the word
"three", the word “four”.
19. Amendment of section 35 of principal Act
Section 35 of the principal Act is amended in paragraph (a)—
(a) by substituting for subparagraph (i), the following—
"(i) to perform an audit in accordance with the standards
adopted by the relevant accounting and auditing
regulatory bodies in Uganda;"; and
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(b) by substituting for subparagraph (iii) (cc), the following—
"(cc) the risks faced by the institution;".
20. Amendment of section 40 of principal Act
Section 40 of the principal Act is amended—
(a) in subsection (1), by inserting immediately after the words "audit report", the words "and a management letter.";
(b) by substituting for subsection (2), the following—
"(2) The institution shall ensure that an audit report and management letter made and submitted to it under subsection (1) are forwarded to the Central Bank within three months after the end of its financial year."; and
(c) by substituting for subsection (3), the following—
e forwarded to the Central Bank within three months after the end of its financial year."; and
(c) by substituting for subsection (3), the following—
"(3) Any institution which fails to submit a report required under subsection (2) shall pay to the Central Bank a civil penalty of fifty currency points and an additional penalty of ten currency points for each day of default."
21. Amendment of section 43 of principal Act
Section 43 of the principal Act is amended by substituting for paragraph (b), the following—
"(b) existence and enforcement of a proper policy of non-accrual of interest or other economic return on non-performing loans or other credit facilities."
22. Amendment of section 46 of principal Act
Section 46 of the principal Act is amended—
(a) in subsection (1)(a), by substituting for the words "or credit accommodation", the words "and other credit facilities";
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(b) by inserting immediately after subsection (4), the following—
"(5) An institution shall perform a credit check on all its customers at the time they apply for credit facilities, unless the Central Bank otherwise directs.
(6) The Central Bank may provide for any other circumstances under which institutions may be required to perform a credit check on their customers."
(6) The Central Bank may provide for any other circumstances under which institutions may be required to perform a credit check on their customers."
23. Amendment of section 52 of principal Act
Section 52 of the principal Act is amended—
(a) in subsection (1), by substituting for the word "four", the word "three"; and
(b) by inserting immediately after subsection (2), the following—
"(3) An institution shall, by 31st August of every year, exhibit in the banking hall of each of its offices and branches, a copy of its unaudited financial statement, stating the fact that the accounts are not audited."
24. Amendment of section 57 of principal Act
Section 57 of the principal Act is amended by substituting for subsection (3), the following—
"(3) Any institution which fails to submit a report required under this section shall pay to the Central Bank a civil penalty of fifty currency points and an additional penalty of ten currency points for each day of default."
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25. Amendment of section 59 of principal Act
Section 59 of the principal Act is amended—
(a) in subsection (2), by inserting immediately after paragraph (d), the following—
59 of principal Act
Section 59 of the principal Act is amended—
(a) in subsection (2), by inserting immediately after paragraph (d), the following—
“(e) restrict the rate of interest or other economic return on savings and time deposits, payable by the institution, to rates that the Central Bank shall determine.”;
(b) in subsection (6), by substituting for paragraph (b), the following—
“(b) before the end of that period, the Central Bank is of the opinion that the financial position of the institution continues to deteriorate,”; and
(c) by substituting for subsection (8), the following—
“(8) For the purposes of this Act, a significantly undercapitalised institution is one which does not comply with any of the following—
(a) hold minimum capital funds, unimpaired by losses, of at least fifty percent of the requirement prescribed in section 15;
(b) hold core capital of at least fifty percent of the requirement prescribed in section 16; or
(c) hold total capital of at least fifty percent of the requirement prescribed in section 16.”
[Page 25]
Micro Finance Deposit-Taking Institutions
(Amendment) Act 2023
Act
26. Amendment of section 60 of principal Act
Section 60 of the principal Act is amended—
(Amendment) Act 2023
Act
26. Amendment of section 60 of principal Act
Section 60 of the principal Act is amended—
(a) by inserting “(1)” before the word “Where”; and
(b) in subsection (2), by substituting for paragraph (g), the
following—
“(g) any lending or other credit facility to any officer,
director or any related person of an officer or director
on preferential terms or without adequate security
made within six months prior to the take-over by the
Central Bank of the management of the institution
concerned shall be rescinded; and that officer,
director or related person to the officer or director
shall immediately refund the monies advanced and
the interest or other economic return accrued.”
27. Amendment of section 61 of principal Act
Section 61 of the principal Act is amended in subsection (1)(g), by
inserting immediately after the word “advance”, the words “or other
credit facility”.
28. Amendment of section 68 of principal Act
Section 68 of the principal Act is amended—
the word “advance”, the words “or other
credit facility”.
28. Amendment of section 68 of principal Act
Section 68 of the principal Act is amended—
(a) by substituting for subsection (2), the following—
“(2) The Central Bank or any person appointed as
a receiver shall take action under subsection (1), which in
the opinion of the Central Bank—
(a) is most likely to result in marshalling
the greatest amount of the assets of the
institution;
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