Kathmandu, Feb. 15
The microfinance
companies have agreed to return Rs. 1.60 billion which they raised in addition
to the service charges to the customers, the Ministry of Finance (MoF) informed
on Wednesday.
A meeting of Deputy Prime
Minister and Minister for Finance, Bishnu Prasad Paudel, Deputy Governor of
Nepal Rastra Bank (NRB), Bam Bahadur Mishra, President of Nepal Microfinance
Backers Association, Prakash Raj Sharma, and representatives of other concerned
agencies held at the MoF at Singha Durbar has also agreed that microfinance
will not charge more than 1.5 per cent service fee per year.
Secretary at the MoF, Toyam
Raya, Executive Director of NRB, Dr. Prakash Kumar Shrestha, Chief of Financial
Sector Management and Corporation Coordination Division at the MoF, Jhakka
Prasad Acharya, and President of Microfinance Association of Nepal, Jagat
Pokharel, were also present at the meeting.
Similarly, it has been
agreed that the provision that one customer cannot take loans from more than
one microfinance institution would be implemented effectively.
According to a
microfinance banker, the amount which was agreed to be refunded is almost one-fifth
of the total service fee the microfinance institutions (MFIs) raise in a year.
Sharma said that the
meeting discussed the contemporary issues of the microfinance sector and
agreement was made to refund the additional service fee to the concerned
customers of the respective MFI within a week. However, the agreement was not
something fresh, it is just a preponement of the decision of the MFIs to return
the money within a couple of weeks after the annual general meeting of the
respective companies.
"Microfinance banks
were ready to refund the additional fees but the meeting today agreed to give
away the money immediately," Sharma said to The Rising Nepal.
However, MFIs said that
the situation arose due to the gap in understanding about the pre-matured loan.
Stating that they were not against the central bank's directives, a
microfinance banker said that there were different explanations about the
service fee.
"MFIs are charging
1.5 per cent service fee when a creditor clears his/her loan earlier than the
maturity date. However, the NRB maintains that the MFIs can't charge additional
1.5 per cent annual fee if the loan is repaid and another loan is obtained at
the same time," he said.
However, he maintained
that a few microfinance companies have made it their strategy to motivate their
clients to clear loan in 3-5 months and obtain another loan which means 1.5 per
cent more income from loan servicing. There are customers who want to clear the
remaining portion of loan and obtain a larger amount for business and other
purposes.
Spokesperson of the NRB,
Dr. Gunakar Bhatta, also said that the government and the central bank had
taken the steps to address that particular practice.
Likewise, the meeting
also agreed upon preparing the details of the customers who are unable to pay
their loans due to various reasons within one month and to utilise the money
from customer protection fund to support such customers.
DPM Paudel instructed the
NRB to study and submit a report on the contributions made by the MFIs in the
economy, employment, tax, financial literacy and social sectors. He also
directed the central bank to solve the problems in microfinance sector.
Published in The Rising Nepal daily on 16 February 2023.
No comments:
Post a Comment