ISLAMABAD, March 19: The Securities and Exchange Commission of Pakistan has issued a concept note proposing amendments to the Non-Banking Financial Companies framework. These proposed changes aim to introduce non-banking microfinance services as a distinct form of business within the NBFC framework, providing clarity for entities engaged in microfinance.
The proposed amendments aim to establish a clear and distinct regulatory framework for microfinance services within the broader NBFC structure. Recognizing Non-Banking Microfinance Services as a separate category, shall enable the Commission to provide tailored regulations that better accommodate the unique needs of microfinance institutions. This distinction will help streamline compliance processes, reduce regulatory overlap, and enhance the ability of microfinance entities to focus on serving underserved and vulnerable populations effectively.
The overlap amongst Investment Finance services digital only and microfinance licenses creates ambiguity regarding application of mandatory requirements and operational scope. As digital lending grows, it’s crucial to clearly distinguish microfinance services within the regulatory structure to address the unique needs of the two lending verticals.
SECP has encouraged stakeholders to review the concept note and provide feedback to refine the proposed amendments, ensuring the regulatory landscape evolves with the needs of the sector.
