Mr. Curtis Brantuo, ARB APEX Bank’s Head of Legal and Compliance Department, has intimated that mobile money activities pose a significant threat to rural and community banks (RCBs).

In order to stay in business, the legal and compliance expert persuaded the rural and community banks to devise methods to manage the existential threat.

Mr. Brantuo noted that the capital required to start a rural bank is less than that required to start a mobile money business, making it more cost-effective to start. As a result, it gives mobile money services an advantage.

“MoMo services are relatively cheaper, their know your customer (KYC) requirements are relatively less cumbersome, the set-up for a MoMo operator is less than one per cent of the capital outlay required to set up a brick-and-mortar bank branch and also MoMo services are often real time, giving the customer real convenience and comfort.”
Mr. Brantuo

Mr. Brantuo averred that RCBs had to either embrace the competition or face a future of uncertainty and anxiety as a result of those challenges. He predicted that the competitive environment will only get tougher as several Fintech businesses were granted licenses by the Bank of Ghana (BoG) to operate as Dedicated Electronic Money Issuers, allowing them to provide services such as cash In and Cash Out, Airtime Top-Up and International Money Transfers.

The legal expert charged the banks to put in more effort adding that “this calls for more hard work and innovation from our rural and community banks”.

The New Reality

According to Mr. Brantuo, experts had anticipated that COVID-19 will remain with the world for a long time, thus the existing manner of doing business had to become the new way of life. Therefore, he added that banks should prepare themselves to thrive even in the face of these existential threats.

“Therefore, all the RCBs must endeavor to put the right structures in place to ensure the sustainability of their banks even in the very difficult and unpredictable times.”
Mr. Brantuo

Mr. Brantuo posited that the ARB Apex Bank had carefully researched developing trends and had chosen to put in place the necessary steps to guarantee that all of its members take full advantage of the trends in order to provide better value to their valued clients.

One of the changes made by the bank, he noted, was ARB Apex Bank’s launch of mobile banking for all of its customers.

The legal expert further stressed the significance of bank customers, urging banks to regard them as the bedrock of the company. As a result, he advised that banks should see it as critical to constantly introduce new items to meet the needs of their clients.

Mr. Brantuo promised that ARB Apex Bank would commence agency banking in the first quarter of this year, giving RCB clients more freedom and creating more jobs through the recruitment of bank agents such as gas stations, supermarkets, pharmacies, and chemical stores.

The Chairman of ARB Apex Bank, Mr. Benjamin Tetteh Apo, emphasized that credit distribution remained the cornerstone of banking, and that excellent credit administration and recovery operations were crucial for long-term viability.