COVID-19: BoG outline measures to lessen financial impact

The Bank of Ghana (BoG) has initiated a number of measures to lessen the financial impact of the coronavirus (COVID-19) outbreak on the public, business entities and the Ghanaian economy in general.

The measures were contained in the press statement issued by the Monetary Policy Committee of the BoG in Accra on Wednesday after its 93 regular meeting to take a monetary stance on the Monetary Policy Rate.

Among the measures, the statement said the Primary Reserve Requirement of the universal banks had been reduced from 10 to 8 per cent to provide more liquidity to banks to support critical sectors of the economy.

“This effectively extends the previous targeted reserves for Small and Medium-Scale Enterprises under the enterprise credit scheme to all critical sectors of the economy,” the statement said.

It said the Capital Conservation Buffer (CCB) for banks of 3.0 per cent have been reduced to 1.5 per cent, to help banks provide the needed financial support to the economy, stressing that “this effectively reduces the Capital Adequacy Requirement from 13 to 11.5 per cent”.

 “Provisioning for Loans in the “Other Loans Especially Mentioned” category is reduced from 10 to 5 per cent for all banks and Specialised Deposit-Taking Institutions as a policy response to loans that may experience difficulty in repayments due to slowdown in economic activity.  Provisioning norms for loans in all other categories are maintained.  This should provide capital relief to banks and SDIs in these uncertain times,” the statement said.

It further said the BoG had agreed with the banks and mobile network operators on measures to facilitate more efficient payments and promote digital forms of payments for the next three months, subject to review, effective March 20, 2020.

“All mobile money users can send up to GH₵100 for free (excluding cash out).  This includes sending to a recipient on the same network, or another network via the interoperability platform,” the statement said, adding that “all mobile phone subscribers are now permitted to use their already existing mobile phone registration details to be on-board for minimum Know Your Customer Account”.

BY KINGSLEY ASARE