The Bank of Ghana (BoG) has increased the minimum paid-up capital requirement for obtaining a Tier 2 and Tier 3 Microfinance Institution License to 2 million cedis from 1 million cedis.
[contextly_sidebar id=”tYQaVEv18ZAbVTDwEPEtRiHwQd8GYedP”]This forms part of a total review of the minimum paid-up capital of rural banks and microfinance institutions.
The latest 100 percent increment comes four months after the Bank of Ghana increased the minimum capital for micro finance institutions by 100%, from 500 thousand to 1 million cedis.
The Bank of Ghana has also warned that all microfinance Institutions which fail to comply with the revised capital requirement will have their operating licenses revoked.
According to the BoG , Microfinance Institutions which have been granted provisional approval by the Bank of Ghana, shall comply with a minimum paid-up capital requirement of GH¢500,000 and submit a credible capital plan to raise the minimum paid-up capital to GH¢2,000,000 .
Applicants who have not been granted provisional approval and new applicants shall comply with the new minimum paid-up capital requirement of GH¢2,000,000 with immediate effect.
Evidence of capital contribution shall be subject to verification by the Bank of Ghana before inclusion in the paid-up capital and registration with the Registrar-General’s Department.
As part of the transitional arrangement for all ready existing micro finance institutions , All licensed Tier 2 Microfinance Institutions are to raise their minimum paid-up capital to GH¢250,000 by 30th July 2015, GH¢500,000 by 30th June 2016 and GH¢2,000,000 by 30th June 2018.
All licensed Tier 3 Microfinance Institutions are to raise their minimum paid up capital to GH¢ 150,000.00 by 31 st December 2015, GH¢300,000.00 by 31 st December 2016 and GH¢2,000,000.00 by 31 st December 2018.
Meanwhile the minimum paid-up capital requirement for obtaining a rural/community banking licence is now GH¢1,000,000 for new applicants or entrants into the industry.
All existing rural and community banks as well as rural and community banks which have been granted provisional approval by the Bank of Ghana have been advised to take steps to enhance their capital, to meet the revised minimum paid-up capital requirement.
As part of the transitional arrangements for all licensed rural/community banks, they are to raise their minimum paid-up capital to GH¢300,000 by 31 st December 2015, GH¢500,000.00 by 31 st December 2016 and GH¢1,000,000.00 by 31 st December 2017.
Meanwhile The Bank of Ghana maintained the minimum paid-up capital of Financial NGOs at GH¢300,000.
By: Rabiu Alhassan/citifmonline.com/Ghana