The Ghana Micro Credit Association (GMCA) has asked the Bank of Ghana (BoG) to review and reduce the ¢2 million minimum capital requirement for micro-credit institutions in Ghana.
Speaking in an interview on Friday, the Board Chairman for GMCA, Wilberforce Ofori mentioned that lending institutions only give out monies and do not accept deposits hence, they will have difficulty meeting the requirement set by the Regulator.
“Micro Credit institutions are helping a lot of people in one way or the other especially in the remote areas. That is why we are saying that for those in the remote areas they do not need a minimum capital of ¢2 million. So we are pleading with the BoG that they should look at the figures and consider it,” he noted.
Last year in August, the BoG directed microfinance companies to meet their minimum capital requirement target of ¢2 million by February 28 this year and that failure to meet this requirement will attract sanctions.
According to Mr Ofori, the capital is a gross increment from the initial ¢300,000.00 minimum capital and credit operators will find it difficult to achieve.
“Initially the minimum was ¢60,000, then it came to ¢100,000, then later ¢300,000 and right from there they are requesting for ¢2 million. That is why we are saying that they should consider somebody in the village somewhere, who wants to support his community members. They won't be able to, because they cannot raise the 2million.” he explained.
However, the Executive Secretary of the Association, Ebenezer Quartey, is hopeful that the BoG will pay heed to their request.
How does the Association intend to address this issue?
According to the Chairman of the Association, his outfit is considering merging two or more Micro Credit institutions to enable them to meet the requirement. This, he said will generate the required capital if the BoG fails to grant them their request