The Financial Regulatory Department under the Ministry of Planning, Finance, and Industry has extended Directive No (2/2020) suspending microfinance institutions from operations until May 15 as a precautionary COVID-19 measure.
The Financial Regulatory Department first issued Directive No (2/2020) on April 6, under which the process of lending and collecting of loans by microfinance institutions would be suspended until April 30.
The ministry said that neither principal nor interest should be collected “with force”.
The temporary suspension of microfinance activities aligns with government efforts to prevent the spread of COVID-19 through mass gatherings and close contact, said U Thant Sin, director of the Financial Regulatory Department.
During the suspension period the Financial Regulatory Department had found some microfinance firms did not follow the directive on loan repayments and forced borrowers to repay the loans.
It warned that failure to fully comply with the directive would result in government action, including the revoking of licenses.
However, activities such as providing loans for emergency and voluntary loan repayments will be permitted during the suspension period. All such activities must adhere to the health guidelines from the Ministry of Health and Sports.
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Source : Myanmar Times
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