Financial Sector Clean-Up: Receiver on course to begin payment of severance packages due ex-staff of resolved MFIs, S&Ls and MCCs


The Receiver of collapsed Micro-Finance Institutions (MFIs), Savings & Loans companies (S&Ls) and Micro-Credit companies (MCCs), Eric Nana Nipah, has confirmed that he is on course to begin payment of all employee related claims – salaries and exit packages due ex-staff – of the defunct institutions.

He had in an earlier communiqué stated that, “The Receiver will in the week commencing Monday, 13 July 2020, engage with the authorized representatives of the ex-staff to agree on modalities for the payment of outstanding salaries and exit packages to ex-staff of these institutions.

“In line with the hierarchy of creditor claims set out under Act 930, other creditors of the failed institutions will be settled upon validation of their claims and to the extent that the Receiver is able to realize value from the remaining assets of these institutions.”

“Please note that the Receiver will only fully settle outstanding salaries and exit packages of ex-staff which have been duly validated agreed and in the resolution process,” the statement added.

This comes after the Bank of Ghana (BoG) had agreed to pre-finance the full settlement of all duly validated and agreed employee related claims.

Following successful preliminary meetings, the Receiver has given assurance that payments will begin from the end of the month.

Significant Challenges

Following agitations from some ex-employees of the affected institutions, and related parties, over the time lapse in payment of their claims, the Receiver provided reasons for the delay.

Responding to these developments, he noted that employee claims ranked as Unsecured in the claims hierarchy in the receivership of these companies, as captured in with Section 135 of Act 930 of the Banks and Specialised Deposit-Taking Institutions Act, 2016.

Furthermore, he highlighted the paucity of and access to employee data to for verification and computation of exit packages; misstatement of a significant number of assets of some of these companies in the financial records of these resolved companies; the availability of funds to settle negotiated and agreed exit package, given the poor asset quality of most of the resolved companies and the timing of realisations as well as the complications brought about by the ongoing Covid-19 pandemic, as factors that have hampered the seamless execution of the process.

These factors required the Receiver engaging he services of the Economic and Organised Crime Organisation (EOCO) to recover assets of the institutions.


In accordance with Section 135 of Act 930 of the Banks and Specialised Deposit-Taking Institutions Act, 2016, claims of ex-staff – excluding amounts due to Directors and Key Management Staff- fall in two categories.

Firstly, as captured in Section 135 (b)(v), includes wages and salaries earned by employees not later than six months prior to receivership. In line with this, the Receiver has guaranteed full payment of all outstanding salaries post receivership.

Secondly, the Negotiated Exit Package, as seen in Section 135 (b) (viii) Compensation of employees not covered under Section 135 (b)(v). Payments captured under this shall include (where applicable): 3 months basic salary per each year of service; accrued outstanding leave days for 2019 to be commuted to cash; medical insurance for 2019 allowed to run till expiry as well as a 30% discount on all outstanding loans.

The Receiver has to date duly negotiated the payment of emoluments with ex-staff of 177 of the 374 MFIs; 21 of the 23 S&Ls as well as 11 of the 39 MCCs.

This translates to 5,637 individuals from 209 institutions and an outstanding total payment of approximately GH₵151.8m n salaries and compensation due.

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