Notice No. 10/GBM/2007 of May 25 - Extension of Financial Services to Rural Areas

1 NOTICE No. 10/GBM/2007 SUBJECT: EXTENSION OF FINANCIAL SERVICES TO RURAL AREAS

Given the need to extend financial services on a national scale, particularly to rural areas, the Bank of Mozambique, in the exercise of the powers conferred upon it by Article 37 of Law No. 1/92 of January 3, combined with Article 64 of Law No. 15/99 of November 1, determines:

ARTICLE 1 (Object) This Notice establishes the special regime applicable to banks and microfinance institutions wishing to extend their activity to rural areas through the opening of branches or other forms of representation.

ARTICLE 2 (Rural Areas) For the purposes of this Notice, rural areas are considered to be all locations that, on the date of entry into force of this regulation, do not have any bank branch within a radius of thirty kilometers.

ARTICLE 3 (Special Regime for Mandatory Reserves)

1. The institutions referred to in Article 1 of this Notice benefit from the incentive that, in the calculation of mandatory reserves, in accordance with Notice No. 2/GBM/2007 of February 28, they may include in the determination, among eligible assets, the value of the cash of the branch opened in a rural area.

2. The entire amount of resources obtained through loans from both residents and non-residents is excluded from the tax base for the calculation of mandatory reserves for microfinance institutions.

ARTICLE 4 (Processing of Applications)

1. The enjoyment of the special treatment referred to in this Notice depends on the submission of the respective application, in accordance with the applicable Law, and additionally, the applications must contain a detailed list of investments in fixed assets for the branch or representation subject to the application.

2. In the application referred to in the preceding paragraph, the applicant may formulate other requests that are established in other legal instruments, namely of a fiscal or customs nature.

ARTICLE 5 (Special Processing Regime)

1. Interested institutions must submit to the Bank of Mozambique applications for other benefits, formulated in accordance with paragraph 2 of the previous article, with the Bank responsible for forwarding said applications to the competent entities for decision.

2. The Bank of Mozambique will communicate to the requesting institutions the decision made regarding the applications submitted.

ARTICLE 6 (Term) The special regime referred to in this Notice is valid for a period of 5 years from the date of entry into force of this Notice.

ARTICLE 7 (Clarification of Doubts) Doubts arising from the interpretation and application of this Notice should be submitted to the Banking Supervision Department of the Bank of Mozambique.

ARTICLE 8 (Entry into Force)

3 This Notice enters into force on the date of its publication. Maputo, May 25, 2007

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Ernesto Gouveia Gove Governor