Unlike the mainstreaming financial institutions, microfinance institutions play an important role in providing access to finance for rural farmers, small businesses, and other people who are engaged in similar activities, and hence, it was necessitated to have a legal framework to govern this issue i.e., Proclamation No. 626/2009. However, for a variety of reasons the existing proclamation needs amendment and the lawmakers came up with a new proclamation, Proclamation No. 1164/2019 (‘the new proclamation’), which introduces some innovative concepts to the existing proclamation. Therefore, in…