The Government of Bangladesh has formed “Microfinance Research and Reference Unit (MRRU)” in Bangladesh Bank on June 18, 2000 to bring Microfinance Institutions (MFIs) under a regulatory framework. To administer the functions of this unit a Steering Committee (SC) under the leadership of the Governor of the Bangladesh Bank was formed under the following TOR:

Terms of Reference (TOR) of the Committee

1. Formulation of policy guidelines to regulate the NGO-micro-finance institutions and setting performance standard to     ensure their qualitative improvement.
2. Preparation of uniform accounting guidelines for micro-finance institutions to ensure their transparency and     accountability.
3. Monitoring the activities of the MFIs in compliance of the policy guidelines prepared by the committee.
4. Recommendations for preparing a legal framework in support of the Micro-finance Research and Reference Unit or a new     regulatory body in its place to act as the regulatory authority for the micro-finance institutions.

Steps taken by the Unit/ Steering Committee before 27 August 2006

1. Published an operational guideline for monitoring management and financial system of microfinance institutions. It contains reporting formats, guideline for measuring performance and an accounting procedure as well as terms of reference for internal and external audit.
2. Based on that guideline MRRU has requested NGO-MFIs to provide half-yearly information since January 2004 to the Unit. Till August 2006 more than 900 institutions reported to MRRU.
3. On the basis of that information given by NGO-MFIs following this self reporting system the MRA has published three volumes of microfinance statistics along with some analysis. Volume-1, Volume-2 and Volume-3 are based on information given at the end of December 2004, December 2005 and June 2006 respectively.
4. The Unit has also provided training to NGO-MFIs on the operational guideline. Till April 2006, more than 600 representatives of these institutions received training from MRRU.
5. The Committee has also prepared a draft law for this sector and submitted it to the government for taking necessary