Resolution CMN No. 2627 — Provisions on the Constitution and Operation of Microentrepreneur Credit Societies

RESOLUTION NO. 2627

Dispenses with the constitution and operation of microentrepreneur credit societies.

THE CENTRAL BANK OF BRAZIL, in accordance with Article 9 of Law No. 4,595, of December 31, 1964, makes public that the MONETARY COUNCIL, in a session held on June 30, 1999, considering the provisions of Provisional Measure No. 1,894-20, of July 28, 1999,

RESOLVES:

Article 1. It is established that the creation and operation of microentrepreneur credit societies, whose exclusive corporate purpose is the granting of financing to individuals, with the aim of enabling undertakings of a professional, commercial, or industrial nature of small size, as well as to legal entities classified as micro-enterprises in accordance with the legislation and regulations in force, depend on authorization from the Central Bank of Brazil.

Paragraph 1. Microentrepreneur credit societies must be constituted in the form of:

I - closed company in accordance with Law No. 6,404, of December 15, 1976, and subsequent legislation, represented by at least 50% (fifty percent) of ordinary shares;

II - limited liability company.

Paragraph 2. The expression "microentrepreneur credit society" must appear in the corporate name of the societies referred to in the caput, and they are prohibited from using the word "bank".

Paragraph 3. Microentrepreneur credit societies must have their activities restricted to the region defined in their bylaws.

Paragraph 4. Direct or indirect public sector participation in the capital of microentrepreneur credit societies is prohibited.

Article 2. It is permitted the transformation, into microentrepreneur credit societies, of organizations whose exclusive purpose is activity in the microcredit segment, provided that their active and passive operations are in compliance with the provisions of this Resolution.

Article 3. The paid-up capital of microentrepreneur credit societies shall be made in cash, in the manner established in the legislation and regulations applicable to financial institutions, except as provided in Article 2.

Article 4. Microentrepreneur credit societies must permanently observe minimum limits of paid-up capital and net equity, adjusted in accordance with the regulations in force, of R$100,000.00 (one hundred thousand reais).

Article 5. Microentrepreneur credit societies may only carry out operations with resources raised domestically and abroad, originating from:

I - national and international development organizations and institutions;

II - state and municipal budgets;

III - constitutional funds;

IV - donations;

V - other sources, provided they are expressly authorized by the Central Bank of Brazil.

Sole Paragraph. The obligations of microentrepreneur credit societies:

I - may not exceed five times their respective adjusted net equity;

II - will not be covered by the Credit Guarantee Fund - FGC.

Article 6. In their credit operations, microentrepreneur credit societies must observe a risk diversification limit of a maximum of R$10,000.00 (ten thousand reais) per client.

Sole Paragraph. The prohibitions regarding the granting of loans and advances established in the legislation and regulations in force apply to microentrepreneur credit societies.

Article 7. The following are prohibited for microentrepreneur credit societies:

I - transformation into any type of institution that is part of the National Financial System;

II - raising resources from the public;

III - equity participation in the capital of other companies;

IV - contracting interbank deposits as a depositor or depository;

V - granting loans for consumption purposes;

VI - assignment of credits with co-obligation.

Article 8. It is permitted for microentrepreneur credit societies to install service points, observing the following:

I - they must be located within the institution's area of operation;

II - they may be fixed or mobile, permanent or temporary;

III - their respective activity must be incorporated daily into the headquarters' accounting;

IV - their creation and closure must be communicated to the Central Bank of Brazil within a maximum period of five business days of their occurrence.

Article 9. The Central Bank of Brazil is authorized to adopt measures and issue norms deemed necessary for the execution of the provisions of this Resolution, including:

I - altering the limits established in Articles 5, sole paragraph, item I, and 6;

II - establishing the conditions for the authorization and operation of microentrepreneur credit societies;

III - fixing the criteria and procedures related to the accounting of the operations of microentrepreneur credit societies, as well as to the preparation and disclosure of their financial statements.

Article 10. This Resolution enters into force on the date of its publication.

Brasilia, August 2, 1999

Arminio Fraga Neto
President