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New rules a fillip for microfinance sector

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RECENT REGULATORY changes are set to spur growth in the microfinance sector, industry sources have told Frontier, although the full impact may not be felt for some time.

Myanmar’s microfinance institutions are starved of equity and this restricts their ability to meet demand for loans. In 2012, the United Nations estimated that unmet demand for credit was more than US$1 billion.

The changes, announced on August 29, will give microfinance institutions greater flexibility in offering loans and allow them to take more in deposits. Together with changes to liquidity and solvency ratios, and sources of loans, the new rules should enable MFIs to offer more credit to Myanmar households.

The reaction from the sector to the changes has been broadly positive, but some want the government to go further in relaxing restrictions.

For more on this story visit the following link: New rules a fillip for microfinance sector

Source: Myanmar Frontier

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