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Ghana Microfinance Law: Deposit Insurance Bill reaches Parliament

The public's attention was drawn to the possibility of the Executive sending the Deposit Insurance Bill to parliament when the President mentioned it in his 2016 State Of The Nation's Address.

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Ghanaian Banking Hall play

Ghanaian Banking Hall

A proposed Deposit Insurance Bill has finally been placed before Parliament for consideration.

The public's attention was drawn to the possibility of the Executive sending the Deposit Insurance Bill to parliament when the President mentioned it in his 2016 State Of The Nation's Address.

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This was in relation to the microfinance scandal that rocked the financial sector in the past several months, where microfiance companies, DKM, Jasta Motors and God is Love Fun Club squandered monies belonging to depositors to the tune of hundreds of millions of Cedis.

An Assistant Director at the Bank of Ghana (BoG), Mr Nesbit Banor, said once the bill came into force, it would give depositors a fall back position in the event of institutional failures.

“The bill does not ensure full recovery of deposits but seeks to provide safety net for depositors. It will ensure banks and special deposit taking institutions adhere to stricter prudential laws,” he said at the opening of a new HFC Bank branch at Adjiringanor, a suburb of Accra.

Mr Banor said such legislation would boost the supervisory role of the BoG and operations of bank holding and financial holding, among others, and engender safe and sound banking practices in the industry.  

 

 

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