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Business News of Tuesday, 7 August 2012

Source: Economy Times

Forex Bureau operators in limbo

Forex bureau operators in the country are facing difficulties in obtaining foreign currencies, particularly the dollar, as their main sources of supply— banks— do not have enough to sell.

Most people in possession of foreign currencies were keeping them rather than sending them to the banks for fear that they might be converted into Cedis. Consequently, most of the operators have to rely on traders from Nigeria and Togo who come to Ghana to do business.

“Business is a bit slow since the bureaus are not getting the currency to sell to people. A transaction that could be done minutes, now takes hours or a day to do that,” said a source who pleaded anonymity.

The Bank of Ghana, in its efforts to stabilise the cedi in the country, ordered the banks to refrain from issuing dollars to their respective clients beyond a certain amount.

Due to the scarcity, some forex bureaus sell the dollar at 2.04 and people buy at 1.99 Ghana Cedis, which was not like that few weeks back. It has eventually led to the denial of people to their dollar accounts thereby causing a lot of problem to most people especially those in the business field who trade in dollars.

“I was so frustrated and disappointed when my bank refused me access to my dollar account,” said one business man who wanted to remain unnamed.

Another problem is that business people who transact business using the dollar will have to halt for sometime since almost all dollar account holders cannot get access to their account and in some cases the banks decide the amount they can withdraw at a time.

The decision the Bank of Ghana has taken, according to industry players, is a serious one and should be well addressed. In 1999 and 2000, the same issue came up and was not properly addressed. In 2012, the issue has cropped up again and this time stringent measures are to be applied.

Recently, the operating licences of five bureaux, namely, Ocean Drive Forex Bureau, Kafsons Forex Bureau, Fatcoms Forex Bureau, Nabrim Forex Bureau and Sears Forex Bureau, all in Accra, were revoked by the Bank of Ghana.

The bureau purchased huge sums of foreign exchange from banks for onward sale to clients but failed to record these purchases in their books and also did not include the information in the returns submitted to the Bank of Ghana, thereby concealing the end use of such funds.

The Bank of Ghana advised all banks and licensed dealers in foreign exchange to strictly abide by the provisions of the Foreign Exchange Act 2006, Act 723, or face stiff sanctions, including prosecution.

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