The Executive Director-Ghana Microfinance Institutions Network (GHAMFIN), Yaw Gyamfi, has indicated the association is currently working on a comprehensive policy that aims to establish clear directions and guidelines for microfinance players.
The initiative comes in response to concerns that many individuals and organisations have been engaging in microfinance activities on their own terms, leading to a lack of uniformity and direction, he said.
According to him, the importance of having a well-defined microfinance policy outlining the sector’s purpose and objectives in the country is that it would enable microfinance institutions to align their operations – similarly to how traditional financial institutions operate.
He highlighted that microfinance players should primarily focus on providing financial support to individuals and small groups, rather than engaging in large-scale investments.
He mentioned that larger amounts of money should be left to traditional banks, while microfinance institutions concentrate on taking care of the financial needs of specific target groups. This approach ensures that microfinance remains accessible and beneficial to those who need it most.
In developing the microfinance policy, multiple stakeholders are being consulted: including academia, the central bank, Ministry of Finance and practitioners in the microfinance sector, he said.
Mr. Gyamfi explained that the first round of consultations took place before drafting the policy, and a second round is scheduled for this month to gather further input and feedback. Additionally, regional consultations will be conducted to ensure comprehensive understanding of the various perspectives and requirements across the country.
He expressed confidence that through these consultations and collaborative efforts, a robust and effective microfinance policy will be developed. He believes that by establishing clear guidelines, the policy will provide a solid foundation for microfinance growth and success in Ghana.
The development of a comprehensive microfinance policy in Ghana, he said, reflects government’s commitment to promoting financial inclusion and ensuring microfinance activities align with needs and aspirations of the country’s population.
With a well-defined policy in place, microfinance institutions will have a clearer direction on how to operate, ultimately benefitting both institutions and the individuals they aim to support, he adds.
Explaining the importance of digitisation, he said it is crucial in today’s fast-paced world wherein customers expect convenient and secure banking services. In this vein, he revealed that the association is putting in measures to ensure members in good standing embrace the use of digital platforms.
Furthermore, Mr. Gyamfi stressed the importance of cybersecurity in protecting sensitive financial data and ensuring the trust of customers. With cyber-threats becoming increasingly sophisticated, it is essential for institutions to follow cybersecurity rules and implement robust security measures to safeguard customer information.
“We are looking at existing institutions that can go into digitisation. I have a commercial bank account, and I do not know the last time I went into a bank. I use their app every time, but it’s all because I have tried it and I know my bank is quite secured. So, that is what we are working on to make sure our institutions are more secure and ensure they follow all the cybersecurity rules,” he noted.
He said this is important at a time when Ghana is experiencing rapid technological advancements, with an increasing number of individuals relying on digital banking services. He added that by focusing on digitisation and cybersecurity, financial institutions can meet the evolving needs of customers while maintaining the highest level of security.
