To ensure a total overhaul of the microfinance sector in the country, the Ghana Association of Microfinance Companies (GAMC) is seeking for an extension in the minimum capital requirement to a maximum of two years.

In 2015, the BoG increased the minimum capital for deposit taking and micro-credit companies from GHS500,000 to GHS2 million, which had a deadline ending last June 2018.

Data from the Central Bank indicates only 30 out of the 319 registered microfinance companies are in a position to meet the new requirement.

In an interview with Goldstreet Business at the Annual General Meeting of GAMC, the National Board Chairman of (GAMC), Collins Amponsah-Mensah said, “the deadline ended in June, but we are having engagement with them [the regulator] to see if there can be some extensions and also some proposal which we think would have to be considered.”

Amponsah-Mensah explained that there is still a lot of work to be done.

“We don’t just want to look at the minimum capital, [but] we want to look at the total overhaul of the system.”

Regulations potentially will open a door to variety of funding opportunities for the MFIs, as well as protect the users of microfinance institutions and creates confidence for the activities of microfinance companies.

To ensure that members of the association operate within an enabling environment, Amponsah-Mensah noted that, mergers and acquisitions are part of the recommendations that has is being made to the central bank.

The Microfinance sector has become a key player and instrumental in achieving financial inclusion within the financial system of the country.

The collapse of a microfinance company goes down with people’s investment and renders the poor client poorer.