Question: Can any of the panelists, including the chair, share with us any act that has been able to regulate operations of MFIs in any of the countries? I'm talking about developing countries…

Grace Rubambey: …some of the NGOs, for example, in my country, Tanzania, are registered as companies limited by guarantee and some are registered under the "society act." But …they all come under…either the banking law or the cooperative law and their ownership is specifically spelled out, …you have to have tangible ownership. So, I don't know if that answers your question, but some countries do have registration, but let's not confuse regulated MFIs and registered MFIs. Regulated MFIs have to be licensed and normally they'll come under two registrations when they are regulated. For example, those that come under the banking law have to be initially registered as companies, limited by shares.

Beatrice Sabana: Yes, I think I just want to reflect on what Tim said, that regulation does not necessarily guarantee good governance. For MFIs in Kenya, …Many of them are registered as NGOs. And there's an NGO act, but as I mentioned earlier you know what happens with an NGO. So that's why we are saying, in addition to the act there need to be other mechanisms in place that will ensure good governance.

Timothy Lyman: You really want to focus on the substance of the legislation, not what it's called. And what you've heard here is that you can be regulated as a microfinance institution even if the law doesn't …refer anywhere to microfinance institutions. Take a look at the … CGAP guiding principles on regulation and supervision of microfinance and I think you'll see some helpful pointers and understand better …how this works.

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