The Bank of Ghana (BoG) has received GH¢900 million to undertake a clean-up of the troubled microfinance sub-sector of the financial services industry.
The move is part of cleaning up the GH¢7 billion debt crisis that has hit a large sector of the deposit-taking, non-bank institutions, including savings and loans companies, in the country.
The governor of the BoG, Dr Ernest Addison, said at a Monetary Policy Committee (MPC) news conference in Accra on Monday, May 27, 2019, that the magnitude of the resources needed to embark on the entire reforms of the deposit-taking, non-bank sector was so large that it had to be approached in phases.
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“We simply don’t have GH¢7 billion to clean-up the entire non-bank, deposit-taking institutions and so we are tackling the micro-finance sector, for which GH¢900 million has been provided,” he stated.
The clean-up of the micro-finance sector, which is expected to begin by the end of the third quarter of the year, would significantly trim down the number of micro-finance companies in the country.
Dr Addison, however, pleaded for time to come up with clear guidelines on the scope of the clean-up of the micro-finance sector.
“Give us a little space and we will communicate the fine details of our decisions later,” he said.
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Source: Yen News