Digital financing boosts Ghana's financial inclusion

Ghana's efforts to improve financial inclusion of its adult population has been receiving a big boost from digital financial services, Deputy Governor of the Bank of Ghana Millison Narh said here on Wednesday.

In his remarks during the launch of the Ghana Digital Financial Service Program, the deputy governor stressed that financial inclusion was critical to achieving inclusive growth.

"The 2015 global Index Survey revealed that Ghana has made significant progress in promoting financial inclusion since the previous survey. The proportion of adults' population using formal financial services rose from 29.4 percent in 2011 to 40.5 percent in 2014

During the period, the Bank of Ghana introduced the new National Payments Systems Strategy which seeks to promote both the use of electronic payments over cash and Electronic Money Issuers and Agent Guidelines aimed at promoting safe and secure issuance and acceptance of digital money to promote financial inclusion.

The signaling effect of these two policy actions of the bank, Narh said, resulted in marked increases in mobile money transactions within the past three years.

The amount of mobile money float balances with partner banks was 223.3 million Ghana cedis (56.81 million U.S dollars) in 2014 compared with 547.9 million cedis (139.41 million dollars) in December 2015.

"The outlook for the mobile money industry is positive, evidenced by increased number of partnership being formed by mobile money operators and regulated financial institutions to deploy innovative financial services targeting the needs of the financially excluded," the Deputy Governor added.

The 5.6 million dollars five-year Ghana Digital Financial Services Program is being funded by government of Switzerland and will be implemented by the International Finance Cooperation (IFC) and CGAP (Consultative Group to Assist the Poor).

It is aimed to provide the sustained effort required to promote inclusive finance by identifying and removing constraints relating to policy, product, design and implementation; as well as customer resistance to digital finance, among others.

Riadh Naouar, Head of Financial Institutions Group Advisory for Sub-Saharan Africa at the IFC, noted that the development of mobile money and agent banking had made it possible to extend financial services to a range of communities.

Carl Ashie of Vodafone Ghana Digital Financial Services was impressed at how far Ghana has come with digitization of financial transactions.

"At the beginning we had a whole lot of people not trusting what the whole thing was. It has a lot of advantages: for people; people are able to save and we all know that savings drive a lot of productivity in the country

"Currently, a lot of our people do not have access to basic financial services so once they have access to these financial services, it helps them improve their lives," Ashie added. Endit