Egypt’s Financial Regulatory Authority (FRA) has announced a one-year extension on the suspension of new license applications for companies and civil society organizations looking to enter the microfinance and traditional consumer finance sectors. The decision, outlined in resolution No. 237 of 2025, aims to regulate market growth and ensure the stability of the non-banking financial services industry.
A Move to Ensure Market Stability
The extension follows an initial suspension (resolution No. 184 of 2024) that was implemented after a significant surge in the number of new licenses granted. According to the FRA, this extended pause will provide the necessary time to evaluate the financial solvency and operational health of existing companies and service providers. The authority emphasized that this measure is part of its broader strategy to strengthen the non-banking financial sector’s role in supporting the national economy while protecting consumers.
The Fintech Exception
Notably, the suspension does not apply to all potential market entrants. The FRA has explicitly excluded companies or entities that plan to operate using financial technology. This exemption aligns with Egypt’s Law No. 5 of 2022, which was established to regulate and encourage the use of fintech in non-banking financial activities. This carve-out signals the regulator’s continued support for innovation and technology-driven financial inclusion, distinguishing fintech-enabled models from traditional ones.
Sizing the Market
The decision comes as both the microfinance and consumer finance sectors have demonstrated substantial scale. According to the latest figures from the FRA, the number of microfinance beneficiaries has reached approximately 3.6 million, with total financing standing at EGP 56.2 billion. The consumer finance sector is even larger, serving around 7 million beneficiaries with a total financing volume of EGP 56.7 billion, underscoring the importance of regulatory oversight in these rapidly growing markets.
About The Financial Regulatory Authority (FRA)
The Financial Regulatory Authority is the primary government body responsible for supervising and regulating non-banking financial markets and instruments in Egypt. Its mandate includes overseeing capital markets, insurance, private pension funds, financial leasing, factoring, mortgage finance, and microfinance to ensure market stability and protect stakeholder rights.
Source: Arab Finance
