The Ghana Association of Savings and Loans Companies (GHASALC) has appealed to the Bank of Ghana (BoG) to reconsider the timelines for implementing its extensive microfinance sector reforms, cautioning that the deadlines may be too tight for operators to meet realistically.
The call follows the Central Bank’s rollout of a comprehensive regulatory framework that significantly increases minimum capital requirements, restructures the industry into clearer categories, and gives institutions up to December 31, 2026, to achieve full compliance.
Under the new guidelines, microfinance institutions, community banks and credit unions are required to raise their minimum capital to GH¢50 million by the end of this year, while new entrants into the sector must have a minimum stated capital of GH¢100 million.
While endorsing the reforms in principle, GHASALC says the transition period requires further consultation.
The Chief Executive Officer of the association, Tweneboah Kodua Boakye, described the reforms as positive for regulation, customer protection and long-term industry stability, but stressed that the implementation timelines need to be reviewed.
He noted that GHASALC supports the Bank of Ghana’s objective of building a more resilient financial sector and strengthening governance standards across microfinance and community banking institutions.
However, he warned that the speed at which capital requirements are expected to increase poses a major challenge for existing operators.
“It is good that the regulator increases this, but from where we sit, inasmuch as it is good, there are other things that we think we need to sit down with the regulator on in the transitioning arrangement, including the length of time the regulator wants to achieve this, among other things. We hope that when we sit with the regulator, we’ll be able to iron out all these issues. On the whole, we think it’s a good thing for the industry,” Mr. Boakye said.
Under the new framework, a microfinance company with a current minimum paid-up capital of GH¢2 million is expected to significantly scale up its capital within a relatively short period.
Mr. Boakye argued that requiring such institutions to raise substantially higher capital within about 11 months or less is overly demanding and could destabilise otherwise viable firms.
He stressed that although the association supports the direction of the reforms, critical transitional issues, including timelines and operational adjustments must be discussed in detail with the Bank of Ghana.
GHASALC expressed optimism that continued engagement with the central bank would result in a more practical implementation roadmap that balances financial stability with industry sustainability.
