Bank Of Ghana takes steps to abolish unfair charges and practices in Ghana's banking sector

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Bank Of Ghana takes steps to abolish unfair charges and practices in Ghana's banking sector

eBitcoinics News 18 Jun, 2021 news.eBitcoinics.com Views: 207

In a statement dated the 17th June 2021 the bank of Ghana issued a communique to abolish the following practices in the banking sector.

The announcement signed by Ms. Sandra Thompson, states that the Bank of Ghana has observed with concern, a trend where some Banks and Specialized Deposit-Taking Institutions (SDIs) impose certain fees and charges on customers. These practices are deemed to be unfair, inappropriate and detrimental to the financial inclusion agenda and the protection of customers’ interests. In line with the mandate of the Bank of Ghana to deal with unlawful or improper practices of banks and SDIs under Section 3 of the Banks and Specialized Deposit-Taking Institutions Act, 2016 (Act 930) and to ensure that the interest of customers of banks and SDIs are adequately protected, the Bank of Ghana hereby notifies banks and Specialised Deposit-Taking Institutions of the abolition of the following practices:

Maintenance Fees on Savings Account, the application of “Account Maintenance Fees” by banks and SDIs on savings accounts inhibits deposit mobilization and discourages the use of banking systems by the general public. Bank of Ghana has noted that the application of such fees has driven a number of savings accounts into debit and in so doing eroded the deposits of vulnerable depositors who would generally expect their savings accounts to earn interest. This practice is detrimental to financial inclusion and negates the gains of the financial literacy programs geared towards promoting personal savings. Banks and SDIs are directed to desist from charging “Account Maintenance Fees” on savings accounts. This ban, however, does not include charges for services provided by banks and SDIs with the explicit prior subscription by customers.

Over the Counter (OTC) Withdrawal Charges Bank of Ghana notes that some banks and SDIs impose penal charges on customers who withdraw their own funds from the banking halls of affected banks and SDIs. The reason commonly attributed to this practice is to encourage customers to use digital platforms provided by the banks/SDIs for such withdrawals, in order to decongest banking halls.

These digital platforms are however not offered for free. While the Bank of Ghana acknowledges the support of banks and SDIs in the digitization agenda, this action deters some customers, especially those who are averse to the use of digital platforms, from opening and operating accounts. The practice also negatively affects the financial inclusion drive of the Bank of Ghana. Banks and SDIs are directed to desist from levying penalties on customers who withdraw own funds below certain thresholds from the banking halls. In addition, banks and SDIs shall not levy penalties against customers who request account balances within banking halls.

The Central Bank goes further to advise the banks to also abolish other unfair practices such as Third Party Deposit/Withdrawal Violations, Quotation of Monthly Interest Rates on Credit Facilities, Application of interest on Penal Charges, Change of Ownership of Collateral Documents, and Credit Insurance Premium Overcharges.

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Bank Of Ghana takes steps to abolish unfair charges and practices in Ghana's banking sector

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