Regulatory Alerts2010-12-29
Law Regulating Decentralized Financial Systems of the UMOA
The West African Monetary Union (UMOA) regulatory authorities, including the Central Bank and the Banking Commission, have issued this law to establish a comprehensive legal and prudential framework for decentralized financial systems operating in member states. The legislation mandates prior ministerial approval for all such institutions, strictly defines their permissible operations (deposit collection, lending, and signature commitments), and classifies them into two distinct categories based on their authorized activities. Furthermore, it imposes rigorous governance, internal control, external supervision, accounting, and liquidation procedures while granting supervisory powers to the Minister, the Central Bank, and the Banking Commission to ensure financial stability and depositor protection.