Study of Microfinance Sector Capacity Building in Sierra Leone

5. EXISTING INSTITUTIONAL FRAMEWORK
5.1. Overview and structure
Key institutions in the industry are the MFIs ( NGOs, community banks,
companies) supported by MITAF, BoSL Microfinance and Community Bank
units, MFP of NaCSA and a few other institutions. There is also the
network organization, SLAMFI, in its embryonic stage.
5.2. Government and its programs
Government, through the microfinance unit in MOFDEP, provides macro
level support to the industry. MITAF is managed by a private consulting
firm on behalf of Government, and has to date produced the most
notable and consistent positive results in microfinance capacity building.
The others are the MFP at NaCSA which faces a challenging institutional
context as well as the microfinance unit of BoSL (with two sections: one
for community banks and the other for other MFIs). For now, government
related meso level support needs rationalizing in a clear institutionalised
framework.
5.3. Registrars, supervisors/ regulators
Resulting from the existing laws, there is some bit of confusion at the
moment. NGO, registered by Government, can in practice do
microfinance business while companies and cooperative societies in the
same business are in principle subject to regulation under the Other
Financial Services Act. BoSL reports to be working on draft legislation for
microfinance, and hopefully this anomaly will be dealt with therein.
5.4. Apex Organizations (Loan Funding & Capacity
Building)
Appendix 5 to this report is an assessment of the meso level
organization. As already mentioned, MITAF has to date had the most
significant impact by way of capacity building. The others have various
capacity challenges (especially technical know-how and institutional
context) which need to be addressed. SLAMFI, very vital for industry
cohesion and information dissemination, is yet to become a working
institution.
5.5. Training and technical assistance service providers
For a growing national microfinance sector, it is necessary to have well
informed trainers, consultants and other providers of technical assistance
with broad and deep knowledge of how the industry works and
international sound practices. This is largely lacking in Sierra Leone
(which is to be expected at this stage). Most microfinance consultants
presently come from outside the country. As part of this strategy,
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