Back to the complete issue
Wednesday, 7 April 2021

Cabinet approves draft bill to regulate fintech industry

The draft law that will govern the fintech space received approval from the Madbouly cabinet in its weekly meeting yesterday, cabinet said in a statement. The new law would regulate the use of fintech to deliver non-banking financial services (NBFS) in a bid to promote financial inclusion and expand the number of beneficiaries.

The 30-article bill authorizes the Financial Regulatory Authority (FRA) to license and regulate the NBFS businesses and fintech startups. The regulator will also have supervisory powers over the sector to ensure companies adhere to transparency and governance standards, in addition to protecting consumer rights.

Background: The FRA completed the first draft of the bill in July before its approval in September. The new regulation reportedly covers crowdfunding, robo-advisory, nano-finance and insurtech, and introduces penalties for regulatory breaches including imprisonment or fines of EGP 200k-1 mn.

Also approved during the meeting:

  • Adding USD 22.8 mn to the inclusive economic governance grant signed last September with USAID, which will bring the US's total commitments under the agreement to USD 50.5 mn;
  • New AfDB shares: The African Development Bank's board decision to allocate new shares to Egypt, raising its total shares in the pan-African lender to 10,099;
  • JICA funding for power sector: A JPY 25 bn (EGP 3.58 bn) loan agreement signed with the Japan International Cooperation Agency last February to boost the electricity sector.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2021 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of Commercial International Bank (tax ID: 204-891-949), the largest private-sector bank in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; and Act Financial (tax ID: 493-924-612), the leading activist investor in Egypt; and Abu Auf (tax ID: 584-628-846), the leading health foodmaker in Egypt and the region.