Notice NO. BG/GOV/SEC/2011/04 Operating Rules and Guidelines for Microfinance Institutions


(enacted in 2011)

The Notice regulates the taking of deposit and the granting of credit microfinance sub-sector activities. Licenses are required for the institutions to undertake these activities. The Notice categorizes activities in microfinance sub-sector into four tiers.

Tier 1 activities are undertaken by Rural and Community Banks, Finance Houses and Savings and Loans Companies.

Tier 2 activities are undertaken by Susu collectors and other financial service providers, including Financial Non-Government Organizations(FNGOs); Credit Unions(which is not regulated by this notice, A Legislative Instrument under the Non-Bank Financial Institutions (NBFI) Act, 2008 will soon be passed to regulate their activities.)

Tier 3 activities are undertaken by Money lenders (companies limited by shares) and Non-deposit taking Financial Non-Governmental Organizations (Companies limited by guarantee).

Tier 4 activities are undertaken by Susu collectors and individual money lenders.

Tier 1 are regulated under the Banking Act 2004 (Act 673), ARB Apex Bank Regulations, 2006 (LI 1825), the Non-bank Financial Institutions Act, 2008 (Act 774) and respective Notices and Circulars issued by the Bank of Ghana.

Contrary to Tier 1, Tier 2, 3, 4 activities are regulated in several aspects in this Notice.

  • Business Form,
  • Capital,
  • Branch Expansion,
  • Permissible Activities,
  • Non Permissible Activities,
  • Prudential Oversight/Reporting

Licensing Requirements for Microfinance Institutions is Appendix 1 for this Notice. The appendix regulates that licensing requirements for Tier 2 and 3 are restriction of eligibility and shareholding, application procedures, minimum paid-up capital, approval in principle, pre-operating conditions and fees. Licensing requirements for Tier 4 include application, licensing procedure and fees.