The Ghana Co-operative Susu Collectors Association (GCSCA) has pledged to collaborate with the Bank of Ghana (BoG) and relevant security agencies to weed out unlicensed susu operators from the industry.
That, the association said, would help reduce the insanity in the industry and the threat it has on the entire country’s security.
Addressing the 10th Annual General Meeting of the association on the theme: ‘Keeping Pace with Development within the Financial Industry in Ghana - The Need for GCSCA to advocate while Maintaining its Traditional Values,” the outgoing President of the association, Mr Seth Kwaku Vidzreku, said the GCSCA intended to increase its membership by 20 per cent this year.
“It is important to note that a lot of members have refused to operate in accordance with the central banks regulations. There have been times when some members have been caught giving clients loans, which is contrary to the regulations,” he said.
He, therefore, urged members to operate in strict accordance with the central bank’s regulations.
He said the upcoming revision of the capital requirement for microfinance companies presented an opportunity for the association in terms of membership but it also presented a greater threat as those companies would now have the financial muscle to compete with susu operators for clients.
Membership dynamics
The Head of Monitoring, Supervision and Evaluation of the association, Mr Edmund Benjamin-Addy, said the membership of the association had been fluctuating since 2013.
He said in 2015, the association carried out a cleaning of its membership data, which saw a drop in the GCSCA’s membership from 508 at the end of the third quarter last year to 462.
This, according to him, grew again to 497 towards the end of the year.
Keynote address
A Microfinance Consultant, Mr Roderick Okoampah Ayeh, who was the keynote speaker, said in spite of all the notable reforms made in Ghana’s financial sector, there was still a large amount of money in circulation outside the formal financial sector.
“This situation is against the background of the increasing number of financial institutions operating within Ghana’s financial space,” he stressed.
He said the country had many financial actors but there was still less outreach, and that was something that stakeholders within the financial sector must urgently address.
“This is because there is a direct correlation between the development of a country and its financial sector,” he said.
He added: “To spur the development of Ghana, we must, as a nation, ensure that our financial sector is well developed to achieve the needed depth of outreach to propel the country’s objective towards total financial inclusion,” he added.
Financial inclusion agenda
The Head of Other Financial Institutions Supervision of the BoG, Mr Joseph Kofi Amoa-Awuah, said the central bank was committed to its financial inclusion agenda.
“The BoG considers GCSCA members as key players in delivering financial services to the doorsteps of the marginal rural poor,” he noted.
He said there was still a huge gap in the provision of financial services for the active rural poor segment of the economy.
“The BoG expects that with the creation of the enabling environment through the introduction of the operation rules and guidelines, stakeholders will take advantage to streamline their operations to deliver efficient and cost effective services while taking advantage of the large untapped potential market,” he said.
He noted that the central bank was aware of operators that operated outside the scope of the operating framework, saying some of the collectors were still operating without licence or with expired licence and outside the scope of the their mandate—granting loans, and sometimes they diverted depositors funds to do other project.
He reiterated that those people would soon face the full rigors of the law and added that “we encourage legitimate operators to help with our fight to weed out the illegal collectors by reporting their activities to the relevant authorities.”
Innovative product
The Director of the Financial Sector Division of the Ministry of Finance, Mrs Magdalene Apenteng, indicated that the financial sector had been developed to do away with inefficiencies and dissatisfaction among people.
“There is no gainsaying that majority of the citizens in the formal sector have patronised the services of money lenders, savings and loans companies, susu collectors and the like for many years,” she said.
She added that it behoved players and stakeholders in the subsector to craft innovative and convenient products and services that would help to improve its modes of operations, reduce risk and consumer dissatisfaction and increase profits.