Regulatory system

Paper

Legal and Regulatory Requirements for Effective Rural Financial Markets

Paper prepared for the conference “Paving the Way Forward for Rural Finance”, June 2-4,Washington (2003)

This paper discusses analogous legal problems in several areas that affect rural financial markets - bank, non-bank, and non-financial lenders and their clients. The paper first discusses the legal framework for secured transactions that governs taking collateral, covering laws of mortgage, pledge, and, for common law countries, the charge and hire purchase. It discusses briefly some issues in the regulation of rural financial institutions. Then it turns to contract enforcement, entry and exist of institutions from financial markets, issues in land rights, land titling, cadastres, and access to credit. It ends its examination of laws with a discussion of intellectual property rights and proper provision of labor and debtor protection. It concludes with recommendations and a review of donor practice.

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