The document pertaining to the proposed draft Bill of the Microfinance and Credit Regulatory Authority, which is scheduled to be presented to Parliament upon Cabinet approval in the future, was extensively discussed at the Sectoral Oversight Committee on Economic Development and International Relations, Members of the Sub Committee under the Ministerial Consultative Committee on Rural Development, Social Security and Community Empowerment established to identify future steps to resolve the microfinance debt issue, and the Women Parliamentarians’ Caucus.
This discussion took place on the 20th, when the Committees met in Parliament under the chairmanship of Hon. Members of Parliament Lakmali Hemachandra, Attorney at Law and Samanmalee Gunasinghe. A group of officials from the Central Bank of Sri Lanka and the Legal Department of the Treasury were also in attendance.
Presenting their views, the officials stated that the initial draft related to this proposed Bill was published in January 2024. They further noted that petitions had been filed before the Supreme Court of Sri Lanka regarding the said draft, and that the new draft has been prepared including the amendments ordered to be incorporated by the Supreme Court, the Committee Stage amendments submitted by the Ministry of Finance to the Supreme Court, as well as other policy-related amendments, and the Gazette has now been prepared accordingly. It was stated further that the Bill is expected to be presented to the Tenth Parliament.
Accordingly, the officials stated that the objective of the Bill is to establish the Microfinance and Credit Regulatory Authority of Sri Lanka, to regulate the business of money lending and microfinance business, to provide protection to customers of such services, and to repeal the Microfinance Act No. 6 of 2016.
The composition of the Board of Directors of this Regulatory Authority was also discussed during the meeting. Hon. Member of Parliament Lakmali Hemachandra, Attorney at Law pointed out that the absence of a member representing the customers of the microfinance business within the Board composition was concerning. It was also highlighted by the Hon. Members that women have been disproportionately affected due to the lack of regulation in the microfinance sector, and therefore the importance of having a Board member representing women was emphasized. Accordingly, the view of the Hon. Members was that a representative from the National Commission on Women, or the Ministry of Women and Child Affairs, or the Secretary to the line Ministry should be appointed as a member of the Board of Directors.
Meanwhile, various other matters contained in the draft Bill were also discussed at length. It was stressed that the purpose of the Bill should be to prevent the social crisis and harm that have arisen at ground level due to the operation of microfinance lending activities without any form of regulation. Accordingly, the Committee instructed the officials to incorporate the necessary amendments into the Bill that is to be introduced in the future. The officials stated that such amendments may be introduced at the Committee Stage of the Bill.
Members of the Sectoral Oversight Committee on Economic Development and International Relations, members of the Women Parliamentarians’ Caucus of the Parliament of Sri Lanka, Members of the Sub Committee under the Ministerial Consultative Committee on Rural Development, Social Security and Community Empowerment established to identify future steps to resolve the microfinance debt issue, and several officials participated in this meeting.
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