The United Kingdom's Department for International Development (DFID) has extended the project, which was taken up eight years ago to strengthen the microfinance regulator, an official said.
The DFID provided Tk 370 million in 2007 to help build capacity of the Microcredit Regulatory Authority (MRA).
With the new extension, the MRA will receive Tk 3.0 million in additional funding from the DFID for the next six months. The project was supposed to be completed by June 30 this year.
Earlier, the microcredit regulator had sought a one-year extension for the DFID-funded project named 'Promoting Financial Services through Poverty Reduction' (PROSPER) in January last year.
After one year's extension, the MRA gets further extension of the project.
"The DFID has confirmed the extension. Around Tk 3.0 million is expected to be added to the original cost of the project, although it is not yet finalised," MRA Director Shazzad Hossoin told the FE.
The DFID support was instrumental in providing the MRA with core operational funding in its early years before government resources became available.
It also provided technical expertise on framing regulations, doing economic analysis and building IT network.
Besides, the fund was used for getting a permanent office space with co-funding from the government.
MRA officials said the regulator did not have enough operational funds from the government in 2007.
The DFID fund helped it grow and become an independent body.
Currently, the MRA has 34 officials under this project, most of them are experts.
However, the government has not approved yet a full-pledged organogram for the MRA, though eight years have passed since its establishment.
Mr Hossoin said, "If the project was not extended, it would have been impossible for us to continue without the project staff."
"We hope the government would provide full support and staff within this year," he added.
Once the new organogram is passed, it would enable the MRA to launch full-fledged operations.
The MRA was established to ensure transparency and accountability of micro-finance institutions (MFIs) in the country. It is the central body to monitor and supervise operations of the MFIs.
Currently, 697 MFIs are registered with the MRA. These registered NGOs are serving more than 40 million out of the country's 160 million people.
With a view to bringing the MFIs under a regulatory framework, the then government in July 2006 enacted the Microcredit Regulatory Authority Act, 2006 (Act No. 32 of 2006), which became effective from August 27, 2006.
The MRA is now in the process of granting licences to more 350-400 MFIs.
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