Actualidad Panama

Access to the Microfinance Sector

Act 130/2013

This law represents a breakthrough in the field of Microfinance as it introduces a prudential regulatory framework based on risk-management; prudential regulations and international accounting standards. This strengthens the oversight of regulated companies, of vital importance, since the country’s financial institutions (apart from the banks) and Non-Governmental Organizations had previously failed to meet international standards on these matters.

Furthermore, a definition of microcredit has been introduced for the first time, distinguishing between microcredit and other types of financing on the basis of the risks involved. The law also focuses on the use of credit technology by microfinance institutions and determines the minimum standards they should use.