CBN Regulations

Central Bank of Nigeria (CBN) is one those first few regulatory bodies in the world who have drafted and implemented national-level microfinance policies in their respective countries.

As it is truly said, a law-maker is efficient as long as it continues to make realistic laws considering the impact on the poorest human being on its land. CBN has lived up to the industry's expectations of being an efficient law-maker. However, it is in the best interest of all microfinance players to safe guard the law by actually implementing it and thereby making every Nigerian to be the proud owner of this law.

Presented below are two policy documents for larger public dissemination to help in a wide-spread implementation. Relevant circulars and announcements as made by the CBN will also be published from time-to-time. You can check back for these on a regular basis as it would be updated constantly.

1. Regulatory and Supervisory Framework - Read the complete document online

Addressing the unique risk profile of microfinance industry, CBN has launched regulatory and supervisory framework for Microfinance Banks in Nigeria. Focus is mainly on

• Governance and Ownership Structure
• Lending Methodology
• Borrower Characteristics
• Appropriate Management Information System
• Internal Control Mechanisms and Procedures

IMPORTANT: A must read for all microfinance practitioners including NGO-MFIs that plan to scale-up their operations and Funding Agencies that plan to collaborate with microfinance banks.

2. Microfinance Policy Paper - Read the complete document online

Microfinance Policy Paper presents a National Microfinance Policy Framework for Nigeria that would enhance the provision of diversified microfinance services on a long-term, sustainable basis for the poor and low income groups. The CBN's Microfinance Policy Paper:

• creates a platform for the establishment of microfinance banks;
• improve the CBN's regulatory/supervisory performance in ensuring monetary stability and liquidity management; and
• provide an appropriate machinery for tracking the activities of development partners in the microfinance sub-sector in Nigeria.

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