The Bank of Ghana (BoG), the central bank of the country, reportedly has implemented more stringent regulations for microfinance institutions (MFIs) in an effort to address an increase in failed microbanks and stolen customer deposits, which have been attributed to “bad management practices, increasing non-performing loans, fraudulent activities and expansion without a commensurate increase in capacity.” Raymond Amanfu, the head of the central bank’s Other Financial Institutions Supervision Department, which is charged with overseeing MFIs in the country, reportedly announced that the new regulatory measures include requiring MFIs to provide photographs of “key management staff” upon renewing their licenses. According to Mr Amanfu, security agencies have been enlisted for the purpose of “handling cases of the institutions which have already made away with deposits funds.”
By Sarah Luo, Research Associate
About Bank of Ghana
Established in 1957, the Bank of Ghana (BoG) has regulatory and supervisory authority over banking and financial institutions in Ghana, including rural and community banks, savings and loan companies, credit unions and non-bank financial institutions. The mandate of BoG is to “maintain stability in the general level of prices, to ensure efficient operations of the banking and credit systems, [and] to support general economic growth.” To do this, BoG adjusts monetary and fiscal policies, acts as a banker and financial adviser to the government, and performs annual on-site audits of the microfinance institutions within its purview through its Other Financial Institutions Supervisory Department. As of year-end 2012, BoG has total assets of GHS 21.7 billion (USD 9.2 billion).
Sources and Additional Resources
Citi Fm Online: BoG Intensifies Regulation of Microfinance Institutions
MicroCapital, July 12, 2014: Bank of Ghana Decides Not to Limit Number of Microfinance Licenses, May Raise Capital Requirements
MicroCapital, March 21, 2014: Bank of Ghana Licenses 394 Microfinance Institutions (MFIs), Donates Equipment to Trade Associations
MicroCapital, January 30, 2014: Bank of Ghana to Limit Number of Operating Licenses for Microfinance Institutions (MFIs)
MicroCapital Universe Profile: Bank of Ghana (BoG) Wiki
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