Egypt’s FRA makes insurance mandatory for microfinance provider

REGULATION WATCH- FRA makes insurance mandatory in micro- and SME finance: The Financial Regulatory Authority (FRA) is forcing microfinance and SME finance players to provide insurance coverage for their borrowers, the authority said in a statement (pdf). The contracts will pay out an amount equivalent to the loans in the event of death or severe disability of borrowers, and lenders will not be allowed to mark up the cost of the coverage. The decision also includes provisions that allow microfinance lenders to demand that SMEs or the project that they would fund be insured.