Regulatory Alerts2022-01-01
Instructions No. (1) of 2022 Concerning the Provision of Financing to Specialized Lending Institutions
The Palestine Monetary Authority issued Instructions No. (1) of 2022 to regulate the provision of low-cost financing to licensed specialized lending institutions for productive micro, small, and medium enterprises in designated sectors such as technology, green projects, agriculture, and tourism. The Instructions mandate that financing cannot exceed 20% of an institution's net equity, require strict compliance with leverage and non-performing loan thresholds, and impose specific borrower eligibility criteria, including Palestinian nationality, minimum age, and adequate cash flow. Furthermore, the regulations establish maximum interest rate caps, mandate monthly reporting and credit bureau disclosure, prohibit the use of funds for debt restructuring or share purchases, and set a maximum four-year repayment period for the granted financing.