Dr. Ernest Addison, Governor of Bank of Ghana (BoG), has disclosed that, although technology has been a driving force of change in the financial sector, the advent of the novel coronavirus far advanced Government of Ghana’s digitalization agenda.
As iterated by the Governor, significant changes in payment technology have made the use of technology in financial services more of a necessity rather than a choice.
This, Dr. Addison stated, is broadly driven by consumer demand for convenience, efficiency, and lower cost of transactions, among others.
“In Ghana, the digitization agenda, including financial digitisation which began long before the pandemic, received an added push during the pandemic, evidenced by the dramatic increase in the growth of digital financial services” he said.
The Governor made this disclosure during his address at the 2021 Ghana Economic Forum, under the theme ‘Strengthening Home Grown Policies to Underpin the National Digitalization Drive and Shared Financial Prosperity’.
As disclosed by Dr. Addison, the Forum “seeks to address one of the most topical issues in recent times, especially, at a time when the country is recovering from the pandemic and policies are being put in place to restore stability and economic growth”.
Ghana’s digitalization drive so far
The Central Bank’s Governor, highlighting key achievements under Ghana’s financial digitalization agenda, stated that, “it is clear that the pandemic resulted in bringing household and firms into the FINTECH space”.
Dr. Addison disclosed “Currently, there are more than 19 million active mobile money accounts driving the digital financial services industry. Prior to the pandemic, this number stood at 14.4 million.
“Similarly, the Mobile money interoperability continued to show strong growth, recording 365 per cent growth in volume and 651 per cent in value between 2019 and 2020”.
Meanwhile, as of September this year (2021), the Governor stated that, the “interoperability transactions grew by 216 percent in volume and 350 per cent in value”.
This, Dr. Addison disclosed, is an indication of growing consumer confidence and preference for digital payment options.
Touching on the move toward digital currencies, the Governor stated that, “currently, digital payments have been on an uptrend and various Governments’ have joined in the digitisation process and most Central Banks are at various exploratory stages of developing Central Bank Digital Currencies”.
Also, the Governor disclosed that his outfit has already transitioned into the piloting stage of the central bank central currency (CBDC) that is the ‘e-Cedi’.
“This will eventually lead to the issuance of a digital currency, the e-Cedi, a safe and stable means of payments and settlements which would further advance financial inclusiveness, promote efficiency in the payment systems, and foster competition in the financial sector.”
Highlighting the systems that have contributed to advancement in financial digitalization, the Governor stated the Ghana Interbank Payment and Settlement System (GHIPSS) and Real Time Gross Settlement System (RTGS) among others, as key drivers of these milestones.
“The achievements in the payment ecosystem would not have been possible without the solid payment infrastructure base and sound regulatory frameworks that have supported the [financial digitalization] process” he added.
The Forum which brought together distinguished stakeholders including Deputy Governors of the Bank of Ghana, Dr. K.K. Sarpong, Chief Executive Officer (CEO), Ghana National Petroleum Corporation (GNPC), and Ministers of State, among others, is expected to last for the period starting from 18th to 20th October 2021.