The Bank of Ghana (BoG) has put on hold the issuing of new licences to microfinance companies.
The move is part of efforts by the central bank to sanitize the industry which was recently hit with a number of fraud cases.
The development led to customers of microfinace companies such as DKM and God is Love Fun Club and many others to lose millions of cash following fraudulent activities of the companies.
According to the Governor of the Bank of Ghana, Dr. Abdul Nasir Issahaku ‘right now, we don’t issue any license at all, until we successfully sanitize our industry and it is important.
Because as we move on we want to enhance financial inclusion. It is an important role the microfinance institutions play’.
It is unclear how long the freeze on issuing new licences will last, but speaking after his swearing in by President Mahama at the Flagstaff house this afternoon, Governor of the Bank of Ghana Dr. Abdul Nasir Issahaku said the move together with others will help resolve the challenges facing the microfinance industry.
‘‘The important thing is to focus and look ahead, what we can do to sanitize that sector, and the Bank of Ghana is already undertaking a lot of initiatives to deal with that including, announcing our regional presence so that we can better supervise and monitor the activities of these micro finance institutions.
There are many of them.
Recall before the Bank of Ghana came into the micro finance business, it was being licensed by the police ordinance. The Bank of Ghana came later to try and sanitise it’.
Dr. Abdul Nasir Issahaku also added that his primary focus as a Governor will be to sanitize the microfinance industry.
‘So some of them have actually never been licensed by the Central Bank, granting that some who have been licensed have had serious challenges and we are beginning to deal with those.
It reminds one of my primary focus areas to deal with the micro finance.
To sanitize it so that we can all have confidence in their operations because they are a critical part of economic development’’. He said.
Despite moves by the BoG to resolve the DKM and God is Love fun club challenges customers of the two companies are yet to receive their locked up investments.
