Nepal: Microfinance & Cooperative Transactions Ordinance

This "Microfinance and Cooperative Transactions Ordinance, 2006" promulgated by the king of Nepal aims to help:

• Develop microenterprises in the country;
• Promote and expand institutions and societies working in the microfinance and cooperative sectors;
• Regulate and systematize microfinance and cooperative transactions in order to alleviate rural and urban poverty through such transactions;
• Ensure the sustainable development of the country's economy.

It comprises the following ten chapters:

• "Preliminary" defines various terms such as "Center," "Board," etc;
• "Establishment of Microfinance and Cooperative Center and its Functions, Duties and Powers";
• "Formation of the Board, and its Functions, Duties and Powers" outlines facilities for the chairman and board members, rules for meetings, etc;
• "Provisions Concerning the Fund and Audit of the Center" outlines the provisions for the funds of the Center;
• "Provisions Concerning License" prohibits microfinance institutions (MFIs) from operating without a license from the Center;
• "Provisions Concerning Capital" details the capital that MFIs have to maintain and explains the constitution of various funds;
• "Regulation, Inspection and Supervision" outlines the regulatory powers of the Center;
• "Provisions Concerning Accounts, Records, Particulars and Report" lists provisions regarding balance sheet, audits, etc;
• "Provisions Concerning Offences and Penalties" explains actions that the Center deems offences and outlines various penalties;
• "Miscellaneous" outlines provisions for liquidation, settlement of liabilities, etc.