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Business News of Wednesday, 27 November 2019

Source: citibusinessnews.com

BoG to consider introduction of E-Cedi to boost digital transactions in future

The Bank of Ghana has announced plans to introduce an electronic currency, E-Cedi, in the near future to enhance digital financial services in the country.

According to a report by the Bank of Ghana, digital transactions such as mobile money keeps increasing in the country, while the value of cheques issued by commercial banks keeps declining.

The total value of mobile money transactions for the first half of 2019, for instance, hit Ghc140 billion, which is a 34% increase from the Ghc104 billion recorded in the same period last year.

But on the contrary, the volume of cheques issued by commercial banks declined from the Ghc3.6 million issued in the first half of 2018 to Ghc3.3million during the same time in 2019.

Speaking at the 23rd National Banking Conference, organized by the Chartered Institute of Bankers, Governor of the BoG, Dr Addison, said the introduction of the E-Cedi will help promote digitization in the financial sector.

“The Bank of Ghana is also in discussion with key stakeholders to explore a pilot project (in a sandbox environment) on central bank digital currency with the possibility of issuing an e-cedi in the near future.”

The Governor added that “the opportunities of digitizing financial services are enormous and can be explored effectively to scale up financial access for Ghana’s economic transformation agenda”.

He however assured that his outfit will strengthen its monitoring and regulatory works to protect the general public.

“Let me note that the future of financial services is digitization. But, it raises some key strategic issues for the banking industry including how each institution can leverage digital financial service technologies for growth; whether through competition or partnerships.”

A lot of fintechs are now providing financial services that are convenient and accessible.

According to the Bank of Ghana, 16 tech firms have so far collaborated with 22 banks to offer various digital services.

Dr Ernest Addison said the introduction of the e-currency forms part of the regulation of the financial services sector to meet the country’s growing demand for digital transactions.

Meanwhile, President of the Chartered Institute of Bankers, Patricia Sappor, has charged banks to align themselves with the ongoing global revolution.

“Some banks have recorded over 80% of their transactions emanating from these digital and electronic channels. I commend this drive and urge banks in Ghana to continue to disrupt themselves and leverage emerging technologies such as AI, Deep data mining, robotics, Blockchain etc.”