Egypt's FRA Suspends Establishment of Microfinance Companies for 1 Year

The Board of Directors of the Financial Regulatory Authority (FRA), headed by Mohamed Farid, decided to suspend initial approval for establishment and licensing for companies and entities wishing to practice microfinance or consumer finance activities for one year.

The Authority stated in a statement, Sunday, that it also suspended accepting applications for obtaining a license to practice microfinance activities for associations and civil institutions, for a renewable year.

It indicated that these decisions come within the framework of the Financial Regulatory Authority's continuous keenness to achieve financial stability for markets and non-banking financial institutions in a way that enhances their role in the national economy, and based on the noticeable growth in new licenses issued by the Authority for companies.

According to the statement, the number of new licenses granted by the Financial Regulatory Authority to companies operating in the activity of financing micro-enterprises during the last two years amounted to 10 licenses in addition to about 6 requests currently being studied from a total of 25 companies that have obtained a license.