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15.03.2005 Business & Finance

Reduce interest rates and transfer charges - Officials

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Accra, March 15, GNA - The Minister of Finance and Economic Planning and Governor of the Central Bank have charged commercial banks to reduce real interest rates and transfer charges to make the sweat of private entrepreneurs worthwhile and meaningful.

They noted that even though the signs of competition among the banks were encouraging, competition was not yet keen enough, especially in the pricing of products and services.

Mr Kwadwo Baah-Wiredu, Minister of Finance and Economic Planning and Dr Paul Acquah, Governor of the Central Bank, made these comments at the opening of a new branch of SG-SSB Bank at the Premiere Towers in the Ministries.

The bank also opened its Privilege Banking wing to provide dedicated, personalized, reliable and fast banking to high net worth customers and individuals.

Dr Acquah said real interest rates spread and charges for transfers and other transactions remained very high and within a narrow band. "Competition should go beyond the putting up of new structures and opening of new offices to a culture where banks effectively reach out to the public to mobilize savings and provide support for businesses."

He said the Central Bank expected banks to follow practices that promoted an efficient market, reduced the cost of financial intermediation and delivery of financial services with good management and adequate control systems.

Dr Acquah announced that the Bank of Ghana was to create a nationwide-shared Automatic Teller Service accessible to ATM as well as VISA cardholders.

"The principal aim of the project is to enhance the efficiency and safety of the country's payment system and the ability to deliver financial services in a cost effective manner to the public at large." Mr Baah-Wiredu said it was disturbing that even though the Bank of Ghana's Base Rate is 25.5 per cent the operating rate in the open market is 36 per cent.

He advised that it was important to look at the issue of cost of capital to business, saying this made it difficult to do business. 15 March 05

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