The Bank of Ghana (BoG) has said it would not renew licenses of susu collectors who are non-compliant with set regulations governing susu operations in the country.
The Central Bank noted that the practice of susu collectors, taking money from individuals and keeping them in personal accounts or lending such monies to third parties is still being practiced by some recalcitrant persons.
Ernest Gyepi-Garbrah of the BoG’s Other Financial Institutions Supervision Department, who was speaking to the B&FT at the 13th annual general meeting of the Ghana Co-operative Susu Collectors Association (GCSCA) in Accra, said immediate sanction to perpetrators of this offence is the non-renewal of licenses by the BoG.
The modus operandi of the susu business states that, savings are made and moneys are collected at the end of an agreed period with a commission to the operator. “The lending of these moneys to third parties as loans is the challenge we are fighting because the lender can run away anytime. Such moneys must also not be kept in personal accounts,” he said.
Instructively, BoG, says such monies must be kept in the susu entity’s name.
The revocation of licenses of some microfinance institutions and fund management companies in 2019, including the banking sector regulatory reforms, have significantly affected susu operations in the country, as most operators have not been able to access their funds to pay their clients.
Though the practice of saving monies in the accounts of third parties in the susu business is illegal, many operators of the GCSCA contravened this rule.
General Manager of GCSCA, Edmund Benjamin-Addy, however said, some illegal operators are still going against this directive, and called for such persons to join the association to streamline their activities.
Benjamin Addy revealed that locked up funds of some GCSCA members in some collapsed financial institutions, have shrunk the operations of some of the well-organized susu operating entities whose monies were involved. He called on security agencies and district assemblies to help the association to clamp down on unlicensed susu operators in their localities.
Banking consultant, Dr. Richmond Atuahene, who spoke as special guest, said there must be a deliberate attempt to provide quality financial literacy education for susu business sustainability in Ghana. Dr. Atuahene asked the GCSCA to invest in financial literacy programmes through partnership with key institutions.