One Trillion outside banking system

A Bank of Ghana (BOG) Adviser, Mr Emmanuel Asiedu- Mante, is reported by the Daily Graphic to have expressed concern about the huge currency outside the banking system.

He said it is unacceptable that for the last quarter of last year, a little over one trillion, representing 94 per cent of total currency, was in circulation.

This, he said, puts inflationary pressure on the economy and "blunt the capabilities of the instruments of monetary management".

Launching a new financial scheme by the Metropolitan and Allied Bank (MAB) and Ghana Post Company (GPC) in Accra on Tuesday, Mr Asiedu-Mante called on the banks to adopt innovative marketing strategies to mobilise "these idle funds into the banking system to enhance redistribution to productive sectors of the economy and to ensure the effectiveness of monetary policy".

The scheme, Metropost Certificate of Deposit, is in the form of a 91-day fixed term deposits, with flexible features which include linking of deposits to an interest-bearing account which offer tiered interest rates.

Presently available at 56 post offices and MAB branches, it is also linked to monthly raffles with attractive prizes.

Mr Asiedu-Mante attributed the huge cash in circulation to the culture of the Ghanaian to hold cash rather than its substitutes like cheques, adding that the problem cocoa farmers often go through each year with the Akuafo cheques could also make the citizenry prefer holding physical cash to holding cheques.