Microfinance Bill, 2012 H.B. 2, 2012 any business or activity other than approved microfinance business: Provided that a deposit-taking microfinance institution may hold shares⎯ (a) which result from an arrangement whereby a loan owed to it by a company is converted into equity; or (b) under any other arrangement entered into for the purpose of recovering a debt to the institution. (2) If, on application being made, the Registrar refuses to grant approval for the purposes of subsection (1), he or she shall, within ten days after reaching his or her decision, notify the deposit-taking1 microfinance institution concerned, in writing, of his or her decision and of the reasons for it. (4) A deposit-taking2 microfinance institution that contravenes subsection (2) shall be guilty of an offence and liable to a fine not exceeding level ten. 30 Restriction on microfinance institution extending credit to officers, employees and certain shareholders and their relatives (1) In this section⎯ “significant interest” means a percentage of⎯ (a) the share capital of a deposit-taking3 microfinance institution; or (b) the voting rights of members of a deposit-taking4 microfinance institution; which exceeds such percentage as may be prescribed. (2) No microfinance institution shall knowingly extend credit to or for the benefit of⎯ (a) any of its officers or directors; or (b) any person who holds a significant interest in the institution; or (c) any relative of persons referred to in paragraph (a) or (b); on terms and conditions that are more favourable than those on which the institution, applying criteria normally applied in the microfinance industry, would extend credit to other persons of the same financial standing: Provided that this subsection shall not prevent a microfinance institution from extending credit to one of its employees, where the credit is extended as part of the employee’s conditions of service and is available to other employees. 31 Principal officers of microfinance institution (1) Every microfinance institution shall appoint a chief executive officer, a chief accounting officer and such other officers as may be prescribed, and no person shall be appointed to hold two or more such posts at the same time unless approved by the Reserve Bank. 1 2 3 4 (sic) Note by Veritas. an earlier draft. (sic) Note by Veritas. an earlier draft. (sic) Note by Veritas. an earlier draft. (sic) Note by Veritas. an earlier draft. The words inappropriate words“deposit-taking” seem to have been carried over from The words inappropriate words“deposit-taking” seem to have been carried over from The words inappropriate words“deposit-taking” seem to have been carried over from The words inappropriate words“deposit-taking” seem to have been carried over from - 19 -