MICROCAPITAL BRIEF: Ghana Increases Bailout of Financial Sector by $471m, Partly to Refund Deposits to Microfinance Institution Customers

The government of Ghana is increasing the total by which it is reimbursing parties impacted by the closure of some of the country’s financial institutions from GHS 2.4 billion (USD 434 million) to GHS 5 billion (USD 906 million), according to a statement attributed to President Nana Akufo-Addo. The new funding is for depositors and others involved with microfinance institutions and “second-tier lenders” that have closed down. The government has been tackling insolvency in the country’s financial sector in phases, beginning with a bailout of universal banks that it completed in December 2018 at a cost of GHS 11 billion (USD 2.0 billion). In total, the deposits of 4.6 million customers were at risk, and the government will have spent GHS 20 billion (USD 3.6 billion) on bailouts.

Sources and Additional Resources

Bloomberg article
https://www.bloomberg.com/news/articles/2020-02-20/ghana-to-increase-guarantees-for-deposits-held-at-failed-lenders

More news on Ghana
https://www.microcapital.org/?s=Ghana

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