SECP Introduces New Compliance Rules for Non-Banking Microfinance Companies

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has introduced a set of mandatory requirements for non-banking microfinance companies (NBMFCs) to enhance consumer protection, promote gender inclusivity, and improve transparency in the sector.

Key measures include the adoption of consumer protection principles, mandatory reporting of gender-disaggregated data, and gender sensitization training for staff and management. The new requirements aim to foster fair practices and support the evolving needs of microfinance clients, especially women.

To improve transparency, the SECP has made it mandatory for all NBMFCs to report gender-disaggregated data and complaints through the SECP’s ESG Sustain Portal. This initiative is expected to offer valuable insights into the experiences of borrowers, helping SECP identify trends, address gaps, and shape evidence-based policies for the sector.

Consumer protection remains a central focus of the initiative. The SECP’s newly introduced consumer protection framework emphasizes clear and transparent loan disclosures to ensure borrowers fully understand their loan terms and conditions. NBMFCs are also required to establish robust grievance redressal mechanisms, ensuring consumers have access to timely and effective solutions for their complaints.

Additionally, SECP has mandated gender sensitization training for all NBMFC staff, including board members, senior management, and field teams. The training is designed to equip employees with the skills to engage with female clients respectfully and create an inclusive environment within the microfinance sector.

These measures are intended to promote financial inclusion, protect consumer interests, and build a more transparent and equitable microfinance ecosystem in Pakistan.