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Supervision

The Registrar is committed to ongoing supervision with the aim of upholding the safety, soundness and stability of microfinance institutions and instilling confidence and integrity within the sector. This process involves off-site surveillance facilitated by the submission of statutory returns on a quarterly basis through the Bank Supervision Application. Additionally, periodic on-site examinations of microfinance entities are conducted as per established on-site examination plans. The overarching goal of ongoing supervision, which combines both off-site surveillance and on-site examinations, is to swiftly detect elevated risks and instances of non-compliance. In cases of non-compliance and other adverse developments, appropriate enforcement measures are taken. The supervisory approach for microfinance institutions is compliance-based, emphasizing adherence to regulatory standards and requirements.

Off-site surveillance of microfinance institutions involves monthly and quarterly reviews and analysis of statutory returns to evaluate financial condition and performance of microfinance institutions

On-site examination

assessing the level of risks inherent to microfinance institutions;

  1. assessing the level of risks inherent to pension entities ;
  2. evaluating effectiveness of risk management system and internal controls in identification, measurement, monitoring, and controlling of risks inherent to the microfinance institutions;
  3. determination of residual risks faced by microfinance institutions; and
  4. assessing the microfinance institutions’ compliance with financial service laws.
Types of on-site examinations include::
  1. routine examination: carried out for every licensee as per examination planning cycle which may be full scope - covering all risk areas of supervisory importance, or targeted on specific areas;
  2. ad hoc: triggered by an adverse event within the institution or market; or
  3. follow up: conducted to ascertain implementation of recommendations from a routine or ad hoc on-site examination.