Mr Seth Terkper, Minister for Finance and Economic Planning in Ghana, has stressed the need to improve confidence in electronic payments systems and infrastructure and to encourage the patronage of alternative payments systems.
Mr Terkper said effective payments systems were necessary for the effective implementation of monetary and fiscal policies as well as for financial stability and also served as an essential input for monitoring budgetary and fiscal performance, and for the advancement of financial inclusion and poverty alleviation, which were the key goals of government.
“All over the world, governments and central banks, being responsible for the financial system, are interested in payments system development. This stems from the fact that an efficient payment system is necessary for effective implementation of monetary and fiscal policy and the promotion of financial stability. Electronic payments bolster the effectiveness of fiscal operations through efficient receipts and payments, security of government transactions, elimination of wastes and leakages, and a strong transaction audit trail. It also provides a comprehensive electronic data warehouse on fiscal operations, essential inputs for budget preparation and monitoring fiscal performance,” he noted.
The Finance and Economic Planning Minister noted that, there appeared to be a strong reluctance on the part of the general population to embrace non-cash modes of payment.
“The high demand for cash to pay for goods and services reduces the life span of currency and increases the frequency and cost of currency printing. The large volume of currency in circulation also greatly hampers the implementation of effective monetary policy. Furthermore, cash attracts robberies and other social vices including corruption. A “cash lite” society reduces this attraction and makes Governments’ efforts to fight crime easier because of the ability to track payments from the source to the destination,” Mr Terkper stated.
He, therefore, pledged to work closely with the relevant agencies of government and with the Bank of Ghana to deliver continuous public awareness programs and pursue a financial literacy agenda for both public officials and the general public that would create the necessary demand side synergy for increased usage of electronic payments.
He also called on the media to sensitise the public about new electronic payments systems and urged the Bank of Ghana to review and harmonise the legal regime to create a more enabling environment for new modes of payment to thrive.
Mr Terkper was delivering the keynote address at the opening of a National Payments Strategy Workshop in Accra, yesterday.
The three-day workshop, which is being facilitated by the Bank of Ghana (BoG), Ghana Inter-Bank Payments and Settlements System (GIPSS) and the Standard Chartered Bank, is taking place on the theme: ‘Driving Efficiency and Value through Innovative Solutions’
The workshop is stakeholder collaboration to chart the vision of Ghana’s national payment system landscape and to enhance the efficiency of the modes of payments and transfers in Ghana.
In his opening remarks, Dr Henry Akpenamawu Kofi Wampah, Governor of the Bank of Ghana, said the smooth functioning of payment and settlement systems was crucial for the effective implementation of the central bank’s monetary policy and for maintaining financial and monetary stability.
Dr Wampah noted that several developments had occurred within the payments and settlements landscape since the launch of the first Ghana National Payment Systems Strategy in the year 2000.
He said the major payment infrastructure implemented during the period included the Ghana Interbank Settlement System (RTGS), E-zwich Biometric Cards, Cheque Codeline Clearing System (CCC), Ghana Automated Clearing House (GACH), a National Switch based on smart card technology (Gh-Link), SWIFT Sanctions Screening Engine and the Central Securities Depository (CSD).
He said to enable the orderly and continued development of the payment systems, it had become imperative to draw up a new framework and that the Bank of Ghana would promote the development of a framework that would offer a suite of payment and settlement products, streams and services to meet the various needs of the public, adding that the Bank of Ghana had a statutory responsibility for the payment and settlement systems in the country.
“As a central bank we have a keen interest in the safety and efficiency of payments and settlements system. As you are all aware, the Bank of Ghana has a statutory responsibility for the payment and settlement systems in the country. This responsibility requires the Bank to promote, regulate and supervise these systems to ensure that they are safe, reliable and efficient. The smooth functioning of payment and settlement systems is crucial for the effective implementation of the central bank’s monetary policy and for maintaining financial and monetary stability,” Dr Wampah indicated.
In a statement, Mr Kweku Badu Addo, Chief Executive Officer of Standard Chartered Bank, noted that in as much as there was the need to catch up with technology, it also remained a fact that innovations also opened up to new risks which required vigilance to contain.
