Circular to Microfinance Companies in the Hashemite Kingdom of Jordan

CENTRAL BANK OF JORDAN Central Bank of Jordan

Reference No.: 513 / 3/28 Date: 15 / 8 / 1447 AH Corresponding to: 3 / 3 / 2026 AD

Circular to Microfinance Companies in the Kingdom

Greetings,

Based on the provisions of Article (2/a) of the Microfinance Companies Law No. (107) of 2021 and its amendments, and considering the developmental and pivotal role played by microfinance companies by enabling low-income individuals to obtain the necessary financing to build productive projects that generate sustainable income and contribute to improving their living standards, as well as supporting the growth opportunities of micro and small enterprises by assisting them in obtaining the necessary credit to finance their activities, thereby creating more job opportunities and combating poverty, thus achieving economic and social security, the following is hereby included:

First: Definitions

• Consumer Loans/Financing: Various types of loans/financing granted to individuals to finance the purchase of goods and services aimed at improving their living standards, including, for example: loans/financing granted for social purposes such as education, health, property maintenance, and car purchases.
• Micro Enterprise/Establishment: A company/establishment whose total assets or annual sales/revenues are less than (100,000) Jordanian Dinars and which employs fewer than (5) workers.
• Small Enterprise/Establishment: A company/establishment whose total assets or annual sales/revenues range between (100,000 - 1,000,000) Jordanian Dinars and which employs between (5-20) workers.

In the event that the definition of a Micro Enterprise/Establishment and a Small Enterprise/Establishment as stated above does not fully apply, reliance shall be placed on the number of workers in the company.

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CENTRAL BANK OF JORDAN Central Bank of Jordan

Second: Microfinance Criteria A loan/financing granted falls within the microfinance activity if the following eligibility criteria are met:

a. Purpose of the Loan or Financing: The primary purpose of the loan/financing granted by the company shall be to finance and develop productive projects to contribute to poverty reduction and unemployment, and to achieve self-sufficiency for the client. The company is permitted to grant consumer loans/financing to improve clients' living standards in accordance with the controls specified by the Central Bank of Jordan for this purpose.

b. Client Criterion: The company shall grant the loan or financing to any of the following categories:

1. Low-income individuals.
2. Individuals who are unable to obtain financial services from the banking sector, either fully or partially.
3. Micro enterprises/establishments and small enterprises/establishments.

c. Maximum Value and Fragmentation Criterion: The maximum limit for the loan/financing granted by the company to any client shall be (0.2%) of the total balance of the existing credit portfolio at the end of the month preceding the date of approval of the grant, and shall not exceed (20,000) Dinars for the loan/financing granted to an individual for the first time, and (50,000) Dinars for the loan/financing granted to a micro enterprise/establishment for the first time, and (70,000) Dinars for the loan/financing granted to a small enterprise/establishment for the first time. In the case of a newly licensed company, the maximum limit for the loan/financing granted by it shall be (10,000) Dinars for the loan/financing granted to an individual, (20,000) Dinars for the loan/financing granted to a micro enterprise/establishment, and (30,000) Dinars for the loan/financing granted to a small enterprise/establishment, during the first three years of licensing or until these amounts become less than the aforementioned percentage.

Please accept our highest regards,

[Signature] Governor Dr. Adel Al-Sharkas