Djibouti: lending & credit regulation

Who regulates

• Banque Centrale de Djibouti

  Primary supervisor of credit institutions and microfinance institutions; acts as Registrar General for movable property security interests.

  ^{[1][2][3][4][5][6][7][8][9][10][11][12]}

Core laws & rules

• Commercial Code (Undated (Chapter 8 Section 4 referenced))

  Establishes the legal framework for the creation, registration, and enforcement of security interests in movable property, designating the Central Bank as the Registrar General.

  ^[1]

• BCD Instructions (2018-2022) (2018-2022)

  A series of prudential instructions governing credit classification, provisioning, risk management, and the operation of the Risk Registry and Movable Property Register.

  ^{[4][5][6][7][8][9][10][11][12]}

Licensing & registration

• Credit Institution / Microfinance Institution

  Entities must be supervised by the BCD. MFIs are required to establish formal credit policies and standardized granting procedures.

  ^[5]

Restrictions & warnings

• Loans with at least one unpaid installment exceeding 30 days must be reclassified as distressed and provisioned at 20%, 50%, or 100% based on delay severity.

  ^[6]

• All supervised credit institutions and financial entities must report detailed borrower identification and credit account data to the BCD Risk Registry.

  ^[10][7]

• MFIs must consult the central risk registry and assess borrowers' overall indebtedness before approving any credit.

  ^[7]

Direction of travel

• The regulatory environment is actively modernizing credit access infrastructure through the deployment of an online Movable Property Security Register to facilitate SME lending.

  ^[2][3]

Sources

1. Commercial Code Chapter 8 Section 4: Management and Registration of Security Interests in Movable Property · 2024-03-01
2. Movable Property Security Register FAQ · 2024-03-01
3. Central Bank of Djibouti Movable Property Register · 2024-03-01
4. Classification of Credits According to Their Duration · 2022-01-01
5. Instruction No. 2022-08/IMF on the Granting of Loans by Microfinance Institutions · 2022-01-01
6. On the Reclassification of Distressed Loans and Their Provisioning · 2022-01-01
7. Instruction No. 2022-15/IMF on the Risk Central for Microfinance Institutions · 2022-01-01
8. Instruction No. 2019-03 on the Classification of Loans and Provisioning of Non-Performing Loans · 2019-01-01
9. Regarding the Management of Credit, Counterparty, Concentration, and Exchange Rate Risks · 2019-01-01
10. Instruction No. 2018-01 on the Central Bank of Djibouti Risk Registry · 2018-01-01
11. Registration and Management Procedures for the Movable Collateral Register · 2018-01-01
12. Central Bank of Djibouti Instruction No. 2018-02 on Movable Securities Registration · 2018-01-01