Stakeholders discuss draft bills to strengthen NBFIs

Accra, Sept. 12, GNA - The Bank of Ghana (BOG) on Wednesday organized a stakeholders' meeting to solicit views of financial sector operators on two proposed draft bills aimed at ensuring smooth operations of non-bank financial institutions and promote responsible credit practices.

The BOG is seeking through the Financial Institutions (Non-Banking) Bill to strengthen the regulation, supervision and improvement in the overall performance of such institutions in line with international best practices.

New law would replace the Non-Banking Financial Institutions Law (PNDCL 328) under which the non-bank financial institutions currently operate.

The Draft Borrowers and Lenders Bill seeks to promote a fair marketplace access to credit and provide for the general legal framework for credit and improved standards of borrower information to prohibit unfair practices.

In an address at the opening session, Dr. Paul Acquah, Central Bank Governor, said the two draft bills were integral parts of a comprehensive regulatory framework to ensure a sound, efficient and safe financial services centre in the country.

He said there was the need for the non-bank financial institutions to provide similar services to be well regulated to enhance efficiency and transparency in the sector.

On the Borrowers and Lenders Bill, Dr Acquah said rapid growth in credit necessitated the establishment of a credible system that was transparent and under which lenders and borrowers understood their obligations.

Some of the proposals in the Financial Institutions (Non-Banking) Bill include powers of the BOG as a regulator to intervene in the conduct of a NBFI`s business to protect customers in instances of violation of the bill, insufficient assets to cover liabilities, among other things.

The Bill also empowers the BOG to issue "cease and desist" orders, appoint a receiver to manage the institution or appoint a liquidator to wind up the business of the NBFI.

Other proposals are prudential requirements for non-deposit-taking NBFIs such as Minimum Capital requirements.

Mr Oko-Nikoi Dzani, President of the Non-Bank Association, was positive that the new bills were going to spur development in the sector. He, however, expressed reservations about some aspects of the draft bill that sought to impose minimum capital requirements, saying as non-deposit taking institutions they should be exempted.