A government decided to lower the service charge of 24 per cent for microfinance institutions (MFSs) seven months ago but the decision is not in any progression.
The Microcredit Regulatory Authority (MRA) formed a 10-member committee to revise the schedule.
A committee formed by MRA executive vice-chairman, representatives from the central bank, finance ministry, Credit and Development Forum (CDF), and Palli Karma-Sahayak Foundation. Later, the MRA formed another technical committee presided by MRA director Mohammad Yakub Hossain, They discussed the potential service charge for microcredit operations.
It has been 2 years since the regulator fixed the maximum interest of 24 per cent. Mr Hossain said that Covid-19 was the reason for this delay but the issue is under consideration.
The previous committee in 2019 suggested setting interest rates as per the declining balance method after two years.
The government established the MRA under the Microcredit Regulatory Authority Act-2006.
Source: The Financial Express