Bank of Ghana revokes licenses of 347 microfinance, 155 cease operations

Bank of Ghana revokes licenses of 347 microfinance, 155 cease operations

The Bank of Ghana (BoG) has revoked the licenses of 347 micro-finance institutions in the country.

Thirty-Nine (39) micro credit institutions have also had their licenses revoked by the central bank.

Of the micro-finance institutions affected, 192 of them were insolvent while the remaining 155 were insolvent and had ceased operations.

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The BoG took these actions in line with section 123 (1) of the Banks and Specialised Deposit-Taking Institutions Act, 2016 (Act 930).

This mandates the central bank revoke the licence of a bank or Specialised Deposit-taking Institution (SDI) “where the Bank of Ghana determines that the institution is insolvent or is likely to become insolvent within the next 60 days.”

The BoG has also appointed Eric Nipah as Receiver for the specified microfinance institutions, also in line with section 123 (2) of Act 930.

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YEN.com.gh earlier reported that the Bank of Ghana (BoG) had received GH¢900 million to undertake a clean-up of the troubled microfinance sub-sector of the financial services industry.

The move was part of cleaning up the GH¢7 billion debt crisis that had 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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Source: Yen.com.gh

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