Government bent on protecting small depositors – BoG Governor

Governor of the Bank of Ghana (BoG), Dr. Ernest Addison has disclosed government’s resolve to bring on stream the Ghana Deposit Insurance Corporation.

This, he said, was imperative to ensure the protection of small savers from any unforeseen loss to be incurred by any deposit-taking institutions.

In recent times, the financial sector has experienced some turbulence owing to the collapse of a couple of banks and the run on a savings and loans company suspected of having liquidity challenges.

Dr. Addison made this known at the 83rd Monetary Policy Committee (MPC) press briefing.

In 2017, the Central Bank indicated that it will begin the implementation of the Ghana Depository Protection Act, 2016 (Act 931) in the second quarter of that year.

The Act, passed by Parliament in 2016 is expected to protect depositors from unforeseen circumstances that may result in loss of funds.

The governor said, the BoG is looking at reforming the Special Deposit-Taking Institutions (SDI’s) sector, strengthening them to operate more efficiently, in order to protect depositors.

According to the law, depositors whose monies get locked up in financial institutions during crisis may receive up to GHS 6,250 in compensation, which will be paid by the Deposit Protection Fund Corporation.

In 2016, reports had it that, an initial capital of GHS 26 million was to be provided for the operations of the Deposit Insurance Scheme.

Dr. Addison assured that as part of the reforms to the SDI’s sector, the central bank will ensure it is well capitalised to raise the confidence of the customers in the sector.

“The government is prepared to find the resources to enable us to undertake those reforms,” he added.