The Ghana Stock Exchange (GSE) has embarked on a landmark initiative to enhance financial inclusion with the launch of Over-The-Counter (OTC) Market trading.
This innovative platform is designed to cater to rural banks and small and medium enterprises (SMEs), providing a new avenue for trading securities that are not listed on the main exchange.
Ms Abena Amoah, Managing Director of the GSE, expressed strong confidence in the potential of the OTC Market to bolster the country’s capital market.
Ms Abena Amoah emphasized that this platform is a critical element of a comprehensive master plan developed in collaboration with the Securities and Exchange Commission.
Meanwhile, this strategic initiative aims to broaden the financial market infrastructure, making it more inclusive and accessible to a wider range of participants.
“We believe that as a stock market, this platform is needed to encourage small businesses and the community banks to raise funds and also for shareholders to offload shares smoothly. This is a step in the right direction to support growth and expansion.”
Ms Abena Amoah
Ms Amoah urged small business owners to leverage this platform to secure affordable funding for their expansion plans.
A New Avenue for Rural and Community Banks
The OTC Market offers a flexible and accessible trading environment for securities that do not meet the stringent listing requirements of the main exchange.
This is expected to attract rural and community banks, which have traditionally been excluded from mainstream capital market activities. By participating in the OTC Market, these banks can trade their shares and access much-needed capital for growth and development.
Ms Amoah highlighted that this initiative is not just about creating a new trading platform but also about strengthening the operations of the participating banks and providing investors with more investment options. This holistic approach is designed to ensure the sustainability and robustness of Ghana’s financial ecosystem.
The launch of the OTC Market has received a warm welcome from key stakeholders, including Alex Kwasi Awuah, Chief Executive of ARB Apex Bank. He described this development as a timely opportunity for rural banks to raise “patient capital” — long-term investments that enable these banks to better serve their rural clientele.
“As community and rural banks, you know we are not listed on the stock market but we need investors to support our operations so we can serve our rural folks. This is a good opportunity for many of us. We believe this will help strengthen us.”
Alex Kwasi Awuah
Mr Awuah indicated that his remarks underscore the significance of the OTC Market in providing a vital lifeline to rural banks that play an essential role in local economies.
With the OTC Market now operational, all rural and community banks in Ghana are expected to register and participate. This broad participation is anticipated to drive significant capital inflows into these banks, enhancing their capacity to offer more comprehensive and competitive services to their customers.
The GSE’s initiative to include unlisted companies in its trading activities reflects a forward-thinking approach that aligns with global trends in financial markets.
Many stock exchanges worldwide are developing similar platforms to ensure that smaller entities and those in less urbanized areas are not left behind in the financial ecosystem.
The launch of the OTC Market by the Ghana Stock Exchange marks an important moment in the country’s financial systems. It represents a deliberate effort to democratize access to capital markets, ensuring that rural banks and SMEs can tap into the financial resources they need to grow and thrive.
As more entities come on board, the benefits of this innovative platform are expected to ripple through the economy, fostering greater financial inclusion and supporting the broader goal of sustainable economic development in Ghana.
READ ALSO: Fitch Solutions Upgrades Ghana’s 2024 Economic Growth Forecast to 4.3%
