Related documents
- Is amended by 24th Annual Supplement
- Is amended by Business Laws (Amendment) Act, 2024
- Is amended by Finance Act, 2009
- Amends Banking Act

LAWS OF KENYA
MICROFINANCE ACT
CAP. 493C
- Published in Kenya Gazette Vol. CIX—No. 7 on 19 January 2007
- Assented to on 30 December 2006
- Commenced on 2 May 2008
- [Amended by Finance Act, 2009 (Act No. 8 of 2009) on 1 January 2010]
- [Amended by Finance Act, 2010 (Act No. 10 of 2010) on 1 January 2011]
- [Amended by Finance Act, 2012 (Act No. 4 of 2012) on 1 January 2012]
- [Amended by Microfinance (Amendment) Act, 2013 (Act No. 41 of 2013) on 11 December 2013]
- [Revised by 24th Annual Supplement (Legal Notice 221 of 2023) on 31 December 2022]
- [Amended by Anti-Money Laundering and Combating of Terrorism Financing Laws (Amendment) Act, 2023 (Act No. 10 of 2023) on 15 September 2023]
- [Amended by Business Laws (Amendment) Act, 2024 (Act No. 20 of 2024) on 27 December 2024]
Part I – PRELIMINARY
1. Short title
This Act may be cited as the Microfinance Act.2. Interpretation
In this Act, unless the context otherwise requires—“agency” means—3. Application
Part II – LICENSING PROVISIONS
4. Qualifications for carrying out deposit-taking microfinance business
4A. Qualifications for carrying out non-deposit-taking microfinance business
5. Application for licence
6. Issuance or renewal of licence
7. Categories of deposit-taking business
For the purposes of this Act, the Cabinet Secretary may prescribe categories of deposit-taking business based on geographical, administrative or such other criteria as the Cabinet Secretary may deem necessary.8. Central Bank’s power of inspection
The Central Bank may, under a warrant issued by the High Court, enter any premises and examine the books, accounts or records of any person whom the Central Bank, on reasonable grounds, believes to be carrying out deposit-taking business contrary to the provisions of this Act.9. Revocation of licence
10. Restriction of a licence
Part III – PROVISIONS RELATING TO GOVERNANCE
11. Minimum capital requirements
12. Minimum liquid assets
13. Place of business
14. Prohibited activities
15. Declaration of dividends
16. Application for loan or credit facility
17. Limit on loans and credit facilities
18. Insider lending
19. Limit on shares
20. Management of institutions
21. Disqualifications of Directors
A person shall not be qualified to hold office as a Director if such person—22. Disqualifications of officers
22A. Assessment of officers
23. Financial year
The financial year of an institution shall be the period of twelve months ending on the 31st day of December in each year.24. Form of accounts
25. Accounts to be denominated in shillings
The accounts and other financial records of an institution shall be denominated in Kenya shillings and shall comply with the requirements of—26. Submission of accounts to the Central Bank
27. Disclosures in financial statements
The financial statements of an institution shall disclose—28. Appointment of internal auditor
29. Appointment of external auditor
30. Qualifications of an external auditor
A person shall be qualified for appointment as an external auditor of an institution if that person—31. Exhibition and publication of audited accounts
32. Rectification of audited accounts
Where the Central Bank is satisfied that the audited accounts of an institution do not comply with the requirements of this Act or that the audited accounts contain information that may be misleading or are not published in the specified form, the Central Bank may require the institution to—33. Collection and furnishing of information by the Central Bank
34. Publication of information
Part IV – SUPERVISION BY CENTRAL BANK
35. Inspection of institutions
36. Periodic returns
36A. Powers upon audit or inspection report
Where an external auditor's report, under section 29(8) or an inspection report under this Part reveals that an institution conducts its business in a manner contrary to the provisions of this Act, regulations or guidelines issued thereunder or in any manner detrimental to or not in the best interests of its depositors or members of the public, or that an institution is undercapitalized, the Central Bank shall take any of the following actions—36B. Powers on anti-money laundering, combating the financing of terrorism and countering proliferation financing matters
36C. Penalties for violations relating to money laundering, terrorism financing
37. Power of Central Bank to intervene in management
Part V – PROTECTION OF DEPOSITS
38. Liquidation of an institution by the Central Bank
39. Contributions to the Deposit Protection Fund
40. Protection of deposits
41. Rights of Board on insolvency
Whenever an institution is closed or becomes insolvent, the Deposit Protection Fund Board shall be entitled to receive any notice or other document required to be sent to a creditor of the institution, and a duly authorized representative of the Deposit Protection Fund Board shall be entitled to attend any meeting of creditors of the institution.42. Right of assignment
Part VI – MISCELLANEOUS PROVISIONS
43. Declaration of holidays
Where the Cabinet Secretary considers that it is in the public interest that all institutions, or a particular institution should remain closed on a day which is not a public holiday, the Cabinet Secretary may, by notice in the Gazette, declare that day to be a holiday for all institutions or for the particular institution, and all institutions or the particular institution shall remain closed on that day.44. Orders by the High Court
45. Restriction on use of words “deposit-taking microfinance business”
46. Default by officers or employees
Any officer or employee of an institution who fails to—47. General penalty
A person who commits an offence under this Act for which no penalty is stipulated shall be liable, on conviction, to a fine not exceeding one hundred thousand shillings, or to imprisonment for a term not exceeding one year, or to both.47A. Rights and fundamental freedoms
All persons subject to this Act shall enjoy all rights and fundamental freedoms enshrined in the Constitution unless limited to the extent specified in Article 24 of the Constitution, this Act or any other Act.[Act No. 10 of 2023, Sch.]47B. Limitation of right to privacy
48. Regulations
49. [Spent]
50. [Spent]
51. [Spent]
52. False advertising
53. Consumer protection
54. Transitional provision
History of this document
27 December 2024 this version
Amended by
Business Laws (Amendment) Act, 2024
15 September 2023
31 December 2022
Revised by
24th Annual Supplement
Read this version
11 December 2013
01 January 2012
Amended by
Finance Act, 2012
Read this version
01 January 2011
Amended by
Finance Act, 2010
Read this version
01 January 2010
Amended by
Finance Act, 2009
Read this version
02 May 2008
Commenced
19 January 2007
30 December 2006
Assented to
Cited documents 6
Act 6
1. | Companies Act | 1664 citations |
2. | Banking Act | 380 citations |
3. | Proceeds of Crime and Anti-Money Laundering Act | 330 citations |
4. | Central Bank of Kenya Act | 65 citations |
5. | Building Societies Act | 23 citations |
6. | Kenya Post Office Savings Bank Act | 8 citations |
Documents citing this one 54
Judgment 23
Gazette 17
Bill 5
Legal Notice 5
Act 3
1. | Kenya Deposit Insurance Act | 126 citations |
2. | Movable Property Security Rights Act | 38 citations |
3. | National Payment System Act | 21 citations |
Bench Bulletin 1
1. | Bench Bulletin - Issue 45 |
Subsidiary legislation
Title
|
|
---|---|
Exemption from provisions of Section 19(1) of the Microfinance Act (Cap. 493C) | Legal Notice 29 of 2021 |
Exemption | Legal Notice 55 of 2023 |
The Banking and Microfinance Act (Credit Reference Bureau) Regulations
Repealed
|
Legal Notice 5 of 2014 |
The Microfinance (Deposit-Taking Microfinance Institutions Administrative Sanctions and Penalties) Regulations | Legal Notice 6 of 2009 |
The Microfinance (Deposit Taking Microfinance Deposit Protection Fund) Regulations | Legal Notice 5 of 2009 |
The Microfinance (Deposit-Taking Microfinance Institutions) Regulations | Legal Notice 58 of 2008 |
The Microfinance (Categorization of Deposit-Taking Microfinance Institutions) Regulations | Legal Notice 57 of 2008 |
The Microfinance Act - Exemption | Legal Notice 131 of 2022 |
The Microfinance Act - Exemption | Legal Notice 85 of 2022 |
Exemption | Legal Notice 73 of 2019 |
Exemption | Legal Notice 19 of 2019 |
Exemption | Legal Notice 161 of 2018 |
Exemption | Legal Notice 92 of 2015 |
Exemption | Legal Notice 26 of 2014 |