The Central Bank of Ghana (BoG) has charged the financial technology companies (Fintechs) to explore the vast opportunities in the traditional financial services sector, popular referred to as the ‘susu’ operations.
Dr Ernest Addison, the Governor of the Bank of Ghana, divulged this in a speech read on his behalf at the just ended second edition of the Ghana FinTech Awards, noting that this would increase financial inclusion and support economic stability.
The Central Bank urged fintechs to invest in ventures that would capture the “technologically savvy youth” through tailor-made digitally enabled financial solutions to meet their needs.
Fintechs, according to the Governor, has played a major significant role in the financial system by offering a new and innovative ways for individuals and businesses to manage financial resources, make payments and access credit.
Dr. Addison further noted that such effort was contributing to financial inclusion, economic growth and societal well-being, and therefore urged fintechs to do more through the provision of digital financial services in susu operations.
“We must not ignore the low-hanging fruits. A case in point is the traditional susu model, which has a lot in common with crowdfunding. With the Bank of Ghana’s crowdfunding policy, the enabling regulatory regime has been provided for Fintechs to explore and enhance this financial model familiar to Ghanaians.”
“Susu, which is a hybrid system of savings, investment and credit, had a strong appeal among the unbanked and underserved and could be a comprehensive solution to some of the country’s inclusion problems.”
Dr. Ernest Addison
Fintech’s Role In The Economy
Applauding fintechs for their immense contribution to the financial services sector and the Ghanaian economy, Dr. Addison, however, averred that prior to the emergence of fintechs, the unbanked and underserved were not profitable market segments for the traditional players in the financial service industry based on the branch model.
“With the advent of fintechs and leveraging the extensive network, mobile telephony, savings, credit, insurance, investment, and pension products are now available across the length and breadth of the country, and even in geographically challenging locations.”
Dr. Ernest Addison
Expressing his gratitude for fintech’s role, he explained that fintech has transformed the financial sector landscape rapidly and is blurring the boundaries of both financial firms and the financial sector. “FinTech has simplified financial transactions for consumers or businesses, making them more accessible and generally more affordable,” he added.
Touching on the impact of fintechs on banks, the Governor communicated that the functions of the banking sectors have reduced from complicated to more simplified manner through the innovative products in fintech. “This development has empowered the customers to take their financial decisions and allowed them to get higher financial literacy than ever before,” he said.
Players in the sector, during a panel discussion underscored the essence of the sector to economic growth, and called on the Government and other regulatory bodies to enhance the fintech ecosystem for increased growth.
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