Microfinance industry hopes renewed for Bill
“The microfinance industry had been eagerly awaiting the introduction of the MF Bill in Parliament. We are very pleased that the finance minister committed to move the the Bill, notwithstanding the very heavy legislative agenda before the government,” said Alok Prasad, CEO, Micro Finance Institutions Network (MFIN).
The Bill provides for a comprehensive regulatory framework for the MF sector and puts the RBI firmly in charge of all types of MFIs, irrespective of their legal form. It also has a strong client protection orientation that ought to substantially address the concerns raised by key stakeholders from time to time. “From an MF industry standpoint, what is now critical is that the Bill quickly gets passed by the Parliament. This will ensure that the current situation of regulatory duality gets mitigated and the industry grows within a well defined framework of law,” he added.
When asked if the MFI Act will override the AP MFI Act, he said, “Given our federal structure, in the event of a conflict between a central law and a state law, it is the Supreme Court that decides which law will prevail. I would hope that the AP government will repeal the state law once the
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