BOG Launches inter-bank credit transfer system

Accra, July 12, GNA - The Bank of Ghana on Monday launched an inter-bank credit transfer system to complement the use of cheques and bankers' draft as means of payments and curb the over dependence on cash based transactions.

The new system, which is to be based on the paper credit transfer voucher, would allow customers to transfer small values to accounts of relatives or institutions in payments for various services, such as utility bills, school fees among other things.

The credit transfer voucher is the instrument used by the payer to instruct a bank to move money to a beneficiary's account at another bank branch in the country.

Although the voucher would have the same clearing procedures as a cheque, the difference is that it is based on 'credit push,' that is a bank collects the amount involved from a customer before a transfer is effected.

This is unlike situation, where the person could issue a cheque in expectation of money flowing in to the accounts some day. Launching it, the Governor of the Bank of Ghana (BoG), Dr Paul Acquah said the introduction of the payment system was in line with development worldwide, where credit transfer were assuming greater prominence because of the low level of risks and the comparative ease of automation.

He said retail payment systems and instruments were significant contributors to the broader effectiveness and stability of the financial system and to boosting consumer confidence and trade.

The Governor said an efficient financial and payments system would place Ghana in good position to become competitive in the international financial market place.

"We have a major challenge to move rapidly to develop a payment system infrastructure comparable to those in developed countries to derive the benefits from an integrated global capital market," Dr Acquah said.

He appealed to the commercial banks to complement the efforts of the Bank of Ghana in developing a common payment infrastructure and in introducing modern retail payment products.

Dr Acquah urged the banks to promote the credit transfer payment system by maintaining reasonable charges for the service to enable the public to make use of it.

Mr Damian Zaato, Head Payment Systems Office, Banking Department of BoG, explained that the commercial banks had been asked not to exceed a ceiling of 50,000 cedis as cost to customers per transaction.