Desist from saving with micro-credit institutions — MCAG warns public

The Executive Secretary of the Micro-Credit Association Ghana (MCAG), Mr Ebenezer Quartey has called on the public to desist from saving with micro-credit institutions in the country.

According to him, some micro-credit institutions were accepting and persuading the public to deposit with them when the licence they hold does not allow them to accept deposits.

He stated that the situation was unfortunate and cautioned the public to be well informed about the operations of the micro credit institutions and desist from saving with them. 

Mr Quartey was speaking at the 10th anniversary and annual general meeting of the MCAG held here in Koforidua under the theme, ‘A decade of micro-credit services in Ghana: Achievements, challenges and prospects.’

The anniversary which brought together the over 500 members of the association was  to provide an opportunity for them to take stock of their activities and operations and prepare for the tasks ahead.

It was also to recognise and honour the various members who formed the association as well as those who have worked hard to grow the association.

Mr Quartey stated further that the micro-credit institutions only had licence to give loan credits to their customers adding that those who were accepting deposits were being non-compliant with the regulations and code of conduct of the association.

Speaking on the growth of the micro credit sector, Mr Quartey also called on stakeholder institutions including the judiciary to support members in the credit delivery process revealing that in recent times, some defaulting clients have brazenly dared lenders to bring an action against them in the event of default.

He stated that “for a micro credit operation to thrive, there was the need for institutional protection of the borrower and support for the lender and the relationship should be mutually beneficial and symbiotic”.

The Executive secretary also called for a national dialogue to discuss the future of the microfinance sector in the country.

According to him, “the recent challenges in the financial sector require that the microfinance sector chart a new part in their quest to ensure growth and sustainability”.

He stated that the establishment of an Act for them as part of the regulatory reforms in the banking and financial sector would be apt.

He said the association would continue to play its role in providing support for the over 70 per cent of people who operated in the informal sector to ensure growth in the socio-economic development of the country.

Mr Quartey expressed his appreciation to the Programme for Sustainable Economic (PSED) Development of the German Development Cooperation (GIZ), Bank of Ghana and to other stakeholders for their support to the association.  

For her part, the Board Chairperson for MCAG, Mrs Regina Kumi revealed that the main challenges faced by the association have been regulatory non-compliance, non-compliance with the code of conducts of the association, limited financial and human resources among others and therefore called on members to comply.

From Ama Tekyiwaa Ampadu Agyeman, Koforidua

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