Ghana will deepen steps aimed at creating a stronger and sophisticated financial sector, Bank of Ghana Governor Ernest Addison said here on Tuesday.
These measures, he said, were aimed at improving financial intermediation and credit delivery to boost economic growth.
Besides the mandate of ensuring price stability to create the enabling environment to support sustainable growth, Addison said the central bank was also expected to ensure effective and efficient operation of the banking and credit systems to ensure allocation of resources to the productive sectors of the economy.
“For this reason, the Bank of Ghana has recently rolled out a comprehensive financial sector reform plan to further develop, strengthen, and reposition the sector as a major growth driver,” the governor explained at a day’s seminar on the role of “Monetary Policy, Tools for Economic Development.”
To that end, he said the bank would institutionalize risk-based capital requirements under the Basel II and Basel III framework while enhancing prudential regulations, governance structures of banks and macro-prudential oversight to support a stronger and more sophisticated financial system.
Basel Accords are recommendations on banking laws and regulations issued by the Basel Committee on Banking Supervision.
The governor said the bank would continue, as part of its forward looking monetary policy strategies, to build on macroeconomic stability which remained critical to the overall economic growth process.
The Executive Director of regional bank, ECOBANK Ghana, Morgan Asiedu, observed that in spite of their significant contribution towards national development, Small and Medium Enterprises (SMEs) were faced with issues about lack of access to credit and the high cost of credit.
These challenges, he said, were fueled by the informal nature of the SME sector with poor literacy on the part of most SME operators and their inability to keep proper books of accounts.
He said Ghana needed to be put on the right path towards greater financial inclusion at all levels across the country.
“The financial services landscape globally, and particularly in Africa, is witnessing fundamental changes in a rapid manner. This is partly due to advancement in technology, action by Telcos and Fintechs which provide substitutes to traditional banking products and services, customer sophistication, leading to the demand for better and improved financial products and services among many others,” Asiedu added.
These pressures have led most banks to introduce a variety of internet-based and phone enabled services to improve the lives of their customers.
He urged the SME sector to build their institutions into formal businesses to have stronger positions to overcome these challenges. Enditem