A Deputy-Minister of Finance, Mr. Kwaku Agyemang Kwarteng, has advised members of the Micro-Credit Association Ghana (MCAG) to support efforts by the Bank of Ghana to sanitise the financial sector.
In a speech on the theme ‘Leveraging Micro-Credit for Economic and Social Transformation in Ghana’ at the 9th AGM of the MCAG, the Deputy-Minister said the important role their members play in the economic transformation of the country cannot be underestimated, and it is important that steps are taken to ensure they operate in a disciplined environment.
He stated that SMEs form a major part of Ghana’s informal sector, and when empowered will play a major role in the country’s socio-economic development.
He reiterated that management of various institutions should ensure those who are not registered but operating in the system are called to order and made to register so as to ensure accountability.
He emphasised that government has a role to play in developing the sector and the people which the sector seeks to serve.
On the subject of minimum capital requirement, he stated: “I urge the Association to continue the dialogue they have started with the Bank of Ghana (BoG)”.
Mr. Ebenezer Quartey, Executive Secretary of the Micro-Credit Association Ghana, noted that: “The modest gains we continue to make using micro-credit in leveraging economic and social development cannot be overemphasized; however, they have not come without challenges. A key challenge we face as operators is the high cost of funds for lending”.
He therefore appealed to government, the Ministry of Finance and Bank of Ghana to consider the possibility of setting up a fund that would enable members to access cheaper sources of funds for on-lending.
The Executive Secretary also proposed a national dialogue on the future of microfinance owing to recent developments in the sector, which in his opinion would give a strong policy direction for the sector.
He further urged member-institutions to continue developing the capacity of their employees and ensure that risk is well-managed, because it is inescapable in every decision.
Mrs. Regina Kumi, Board Chairperson of the Micro-Credit Association Ghana, pointed out that: “With the announcement made by Bank of Ghana for a new capital, the Association worked tirelessly and diligently with other affected apexes to submit a petition to the Bank of Ghana through the Ghana Microfinance Institutions Network (GHAMFIN) to consider, among other proposals, extending the deadline as well as reviewing the amount”.
According to her, the petition has received the Regulator’s attention and further engagements are ongoing to ensure that a decision favourable to both operators and government is arrived at. “The engagement has been very cordial, although sometimes challenging. It is my hope that finality will be brought to the process very soon,” she added.
She stated that the year 2017 saw the Association growing from one level to another in terms of its mission and vision. “We shall continue to provide the needed leadership required to meet the aspiration of all,” she affirmed.