 |
Kathmandu,Saturday May 13, 2000 Baishakh 31, 2057.
|
Financial Intermediary Act &
Regulation must be amended
By a Post Reporter
KATHMANDU, May 12 - Governor Dr Tilak Rawal has
said that Nepal Rastra Bank (NRB) will make efforts in making necessary amendments in the
Financial Intermediary Act 2055 and Financial Intermediary Regulation 2056.
Governor Rawal said this while addressing the
second session of a one-day workshop on discussing amendments in Financial Intermediary
Act 2055 and Financial Intermediary Regulation 2056 here today.
Laws are amendable and we should bring changes in
them according to the need of the time. Once amendment draft is made, the Act and
Regulation will be sent to the concerned bodies again for necessary discussions and
process of amendment will be initiated, said Dr Rawal.
Local resource mobilization is basic need in
micro-financing, said Governor Rawal.
Earlier, Dr Shankar Sharma, member of National
Planning Commission (NPC) expressed the views that micro-finance has become an inseparable
part of the government in reducing poverty. It would have been better if the workshop was
held earlier in that very serious condition has arisen which needs solution as early as
possible. MFIs have significant impact on poverty alleviation but Sharma said adding, that
intransparency of non-governmental organizations (NGOs) has compelled the central bank to
make monitoring more rigid.
Participating in the workshop, former Governor
Ganesh Bahadur Thapa said that instead of formulating and enforcing intermediary laws by
the government it would be better to allow the micro-finance institutions (MFIs) to
formulate regulatory mechanism themselves for their better functioning.
"The Act and Regulation are damaging,"
said the former governor.
The mentality of protecting the MFIs on personal
guarantee should be ended and we should move forward creating an environment of trusting
each other, he suggested.
Earlier, Shankar Man Shrestha, Chairman of Rural
Micro-finance Development Centre (RMDC) said that micro-finance helps those having
survival skills but lacking resources. Therefore, it has been an effective instrument in
alleviating poverty. Micro credit has proved that even the poor can be entrepreneurs and
it has a positive impact on women’s empowerment, Shrestha said.
Government’s intervention in the sector is
causing trouble which may be costly in the long run, he warned. Speaking about the
objective of the workshop, he said it was held to create conducive environment to the MFIs
through the amendment in the Act and Regulation.
Presenting a paper, Shalik Ram Sharma, Chief
Manager of NRB said that the Act has prohibited the MFIs to collect deposit directly. This
has made the sustainability of the institutions insecure as all of them can’t receive
donations or borrow from other donor agencies.
Section 23 of the Act has a provision of recovering
the loss, made by such organizations while conducting their business, from the property of
the founders of the organization and the final authority for the settlement of liability
is given to the central bank. This will discourage the NGOs involved in micro credit and
MFIs, said Sharma.
Participants of the workshop presenting expressed
the views that the sections of the Act and Regulation which have negative impact on
financial intermediaries should be immediately amended and changes should be made to
facilitate micro-finance.
The one-day workshop was organized by RMDC.
Other Stories
|
