Microfinance association doubtful all firms will receive licensing

Directors of microfinance companies in the country want the Bank of Ghana to speed up the licensing process under the sector's new rules and guidelines.

The companies, which are taking deposits and making profits, are operating under the second tier of regulated microfinance institutions.

About 81 companies have so far been licensed since the registration process started in July 2011.

In the Ashanti region, some 20 of the 150 members of the Ghana Association of Microfinance Companies (GAMC) have been licensed.

Operators attending the maiden meeting of Microfinance Directors in Kumasi raised issues with the slow pace in obtaining the licensing.

But National Chairman of GAMC, Collins Amponsah-Mensah, says the regulator should not be faulted because “they have to do thorough due diligence before they come out to say that we have confidence in you; we can entrust the destiny of people into your hands when it comes to financial issues and so we're giving you the license”.

He is also doubtful the application of all members can successfully sail through the licensing requirement.

“I don't think that it's every company who applied would be able to licensed. Definitely some will have to do other things; put other structures in place over a period before perhaps they can qualified to get the final license”, Mr. Amponsah-Mensah told Luv Biz Report.

The GAMC Directors' forum was under the auspices of the GIZ and the Responsible Finance Project, which aims at improving financial inclusion by ensuring sustainable access to financial services for the target group.

“We expect that the directors and their companies will be responsible in their dealings with the client in the sense that they'll be transparent and they'll provide all the necessary information that is required to their client”, noted Matthew Affram, National Expert, Banking Supervision under the GIZ project.

Story by Kofi Adu Domfeh/Luv Fm/Ghana