Locked up funds in other institutions affecting operations of micro finance, credit unions
The Swedru Teachers Co-Operative Credit Union is urging government to put up mechanisms to ensure that locked up funds in other financial institutions regulated by the securities and exchange commission are released.
According to him some micro finance institutions and credit unions have their funds locked up in these financial institutions thus crippling their very existance.
Institutions like Gold Coast Securities, Brooks Investment among others were effected during government’s financial sector clean up indicating that some credit unions and individuals have their monies locked up.
Chief Executive Officer of the Swedru Teachers Co-Operative Credit Union, Joseph Acquaye, wants government to put up mechanisms to ensure that the funds are released to the investors.
According to him most credit unions and other individual depositors have their funds locked up in these big financial institutions but once they are released will inject capital into the operation of micro finance and other credit union while increasing employment in that sector.
“Some micro finance and credit union during the financial sector clean up by government were affected in the sense that they had their funds deposited in other bigger financial institutions and these institutions were affected duing the financial setor cleanup. It will interest you to know that some micro finance and credit unions who have their funds in this institutions are struggling to operate and if care is not taken will cripple their operations Chief Executive Officer of the Swedru Teachera Co-operative Credit Union told Citi Business News.
Mr. Joseph Acquaye again wants government to consider giving tax holidays to some micro finance institutions like is done to certain foreign organisation indicating that this will push others to invest more into the system.
“Just like government does to other institutions that come into the country to operate same should be done to some local financial institutions by giving them tax holidays so that they will have the capacity to operate well” the CEO for Swedru Teachers Credit Union said.
Highlighting on some of the challenges they face as a entity, Joseph Acquaye indicated that the Ghana card must be enhanced since it is now the sole identity to be used for any transaction. According to him if the card is enhanced it will be easier for ay financial institutions to access the credit rate scoring of any client in interms of loans acquisition and its recovery process.
“The Ghana Card is a very good thing and I think government must enhance it with more security features to help financial institutions recover loans from clients and access the credit scoring of clients before loans are even disbursed. It will also help the credit union and the micro finance institutions to recover loans from clients. It also means that you cannot just access loans and later throw your sim card away while depositors money has been given to you, “Joseph Acquaye noted.
Source: Ghana Business
