Business News of 2014-04-29

Rural Banks face panic withdrawals

A cross section of customers of rural and community banks in the Gomoa, Agona and Awutu-Senya Districts of the Central Region, have registered their displeasure about the new 17.5 percent Value Added Tax (VAT) charge on withdrawals and deposits.
According to the customers, they have decided to withdrawal their deposits from their various banks before May 2, the deadline, as announced by government. A survey conducted by the press revealed that customers made up of farmers, business men and women, teachers and nurses are not happy about the decision to tax them.
Nana Kweku Duah , farmer and customer of the Akyempim Rural Bank, threatened that he will withdraw all his money from the bank before the stipulated date. He said the new VAT, if implemented, would compel people to keep their monies under pillows, beds and underground to avoid any frustrations.
Mr. Kwesi Andoh, susu contributor resident at Gomoa Manford, cautioned that the VAT law will force them to stop doing business with the banks. He said government’s announcement had not convinced them, so they will still go ahead to withdraw their deposits.
He said it is sad that government is trying to tax their small savings they have made with the banks that can assist them to pay their children’s school fees. Mr. Kofi Sagoe, a teacher and customer at Akyempim Rural Bank said it is worrying that government deducts taxes from their salaries before it goes to the banks, and cannot understand why an additional 17.5 percent charge, adding that that will be a double slap.
According to Mr. Sagoe, already workers are facing serious economic hardships due to high increase of electricity and water tariffs as well as hike in the prices of petroleum products that had affected transportation. Mrs Grace Ankoma, Nurse in Gomoa West, called on government to suspend the 17.5 percent VAT.
She said as a single parent when this happens it will be difficult to take care of her three children, adding that parents are facing the payment of high school fees and other social responsibilities. Mr. Isaac Eshum, Dawurampong branch Manager of the Akyempim Ruiral Bank, assured customers that the bank will continue to perform the core business which does not attract 17.5 VAT.
He expressed the hope that the customers would remain resolute since management and board will never disappoint them as their cherished customers. At Gomoa Afransi, Mr. Robert Job Arkoh, General Manager of the Gomoa Ajumako Rural Bank, said the early announcement of the proposed 17.5 per cent VAT has created panic among customers, hence the huge withdrawals from the customers.
At Agona Kwanyako, Mr. Ben Amosah, General Manager of the Agona Rural Bank, said he had directed his staff to educate the customers who come to transact business to explain the core functions of the bank, for them not to panic.