CBG to Announce Modalities for payments to Depositors of Defunct MFI & S&Ls

CBG to Announce Modalities for payments to Depositors of Defunct MFI & S&Ls

The Consolidated Bank Ghana (CBG) will in the coming days issue the full modalities for payment of cash and bonds to depositors of defunct microfinance and savings and loan companies on behalf of the Receiver.

In a release, the Managing Director of the Bank, Mr. Daniel Wilson Addo, assured depositors of the bank’s commitment to play its role professionally in resolving all issues regarding payments of deposits of customers.

He added that “the bank has established a mechanism for those depositors who wish to obtain cash ahead of the liquidation schedule to discount those expected cash flows with the bank at a very competitive rate.”

The statement from the CBG concluded by reminding the public of the need to observe the various safety protocols to contain the COVID-19 virus.

It can be recalled that the government during the 2020 State of the Nation Address provided GH¢5 billion to be disbursed to pay depositors of the collapsed financial institutions.

The Consolidated Bank Ghana in February said a total of 6,446 individual customers of defunct Microfinance Companies, Finance Houses and Savings and Loans Companies have been paid their locked-up cash.

The Bank also indicated that 449 customers who are social and welfare organizations have equally been paid.

It can be recalled that the Central bank in August 2019 revoked the licenses of some 23 savings and loan companies as well as other finance houses after it declared them insolvent.

The BoG also added that these finance houses could not meet the deadline for the recapitalization capital.

Subsequently, the government announced Eric Nana Nipah as a Receiver to see to the payment of depositors their locked-up cash.

How could customers of collapsed financial institutions access their funds?

The CBG further clarified how customers of the defunct financial institutions could access their cash and bonds.

“At the direction of the Receiver of the defunct MFI & S&Ls, the release said the bank has almost concluded paying affected customers of the defunct institutions the cash component of their validated investments. For customers whose deposits exceed the cash payment threshold as advised by the Receiver, a special account has been opened to hold the balance payable,” it added.

According to the CBG, funds in excess of the cut-off for cash payment would be held in special holding accounts opened for the depositors and paid in equal installments every six months over a five-year period after the initial payment is made in March 2021.