Credit Unions to be licensed by March 31, 2018
Currently, the Credit Union Association (CUA) is collating all the documents and the requirements of all credit unions for onward submission to the Bank of Ghana (BoG) for the licensing process.
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The decision to license all credit unions follows the introduction of a Legislative Instrument (LI) by the BoG to inject sanity into the operations of credit unions in the country.
Those credit unions that cannot meet the requirements for the licensing regime would be absorbed by the bigger ones.
The Regional Manager of Credit Unions, Mr Kenneth Adjei Bosompem, announced this at the annual general meeting of the University of Ghana (UG) Credit Union in Accra.
Member institutions
The UG Credit Union is the largest one in the country with a membership of 6,600 from 26 institutions, including the University of Ghana, the University of Professional Studies, Accra (UPSA), the Ghana Institute of Journalism (GIJ), the Ghana Institute of Languages (GIL),
Ghana Institute of Management and Public Administration (GIMPA), the Wisconsin University College, the University of Health and Allied Sciences and the Islamic University College.
The credit union is said to pay the highest interest on saving and dividends on shares. It has a total asset of GH¢77,095,132.83.
Making credit unions vibrant
Mr Bosompem announced that the University of Ghana Credit Union had been selected among a few credit unions in the country as the first batch to be licensed.
He said the move by the BoG was to make credit unions an institution of choice so that people would not bypass the credit union and join any other financial institution.
Merger
He said the Credit Unions Association of Ghana was pursuing its agenda of ensuring that the bigger credit unions such as the University of Ghana Credit Union were being encouraged to absorb the smaller ones to make them vibrant and be able to survive the competition.
Mr Bosompem hinted that heads of institutions with a number of credit unions were being contacted to bring them together.
“We are ensuring that the bigger ones take over the smaller ones and even some of the bigger ones come together,” he announced.
Commendation
Mr Bosompem commended the leadership of the University Ghana Credit Union for the giant strides it had made over the years, saying, “when you check the sustainability indicators, in terms of liquidity, you have passed the standards, in terms of asset quality you have passed the standards.”
He urged members of the credit union to continue to do the right thing and encouraged them to include continuous saving habits with less withdrawals and repaying loans.
Mr Bosompem advised the leadership to design and make good policies and programmes that would satisfy the members of the union.
Licensing seeks to safeguard
Adding his voice to that of Mr Bosompem, the Ag Registrar of Cooperatives, Mr Ibrahim Oscar Sumailar, explained that the licensing of credit unions was meant to safeguard the interest of members and their financial position.
He commended the management of the union and urged them to continue to pursue the prudent policies which earned the enviable title as the best in the country.
The Manager of the credit union, Mr Francis Fiayiya, said the union made a return of 8.16 per cent on average assets as against an operating standard of six per cent, with a total net surplus recorded at the end of the year under review as GH¢5,649,110.59.
Falsification of documents
He cautioned members who falsified documents in order to procure loans and warned that the board had decided that henceforth, anyone caught would be blacklisted and eventually expelled from the union.
“This action would be without prejudice to any disciplinary action employers would take against the culprit,” he said.
The Board Chairman of the credit union, Mr Ibrahim A. Kwetso, announced that the board had approved a request by members to extend the loan repayment period to give flexible repayment tenure to members.
