The Bank of Ghana (BoG) has unveiled a sweeping overhaul of the country’s microfinance and community banking sector, introducing higher capital requirements, clearer institutional categories, and strict compliance timelines.
The reforms are aimed at strengthening financial stability, protecting depositors, and promoting inclusive growth across rural and urban communities.
At the heart of the reforms is a bold attempt to modernise Ghana’s microfinance landscape, addressing longstanding challenges of undercapitalisation, governance gaps, and uneven regulatory oversight.
Operators now face defined pathways to upgrade, merge, or exit, with full compliance required by December 31, 2026.
Capital thresholds raised significantly
A central feature of the new framework is the sharp increase in minimum capital requirements.
Existing institutions aiming to become Microfinance Banks must raise at least GH¢50 million, while new entrants are required to inject GH¢100 million.
Community Banks, the successor structure for former Rural Banks, are required to meet GH¢5 million, while new urban Community Banks must have GH¢10 million.
Credit unions with assets of GH¢60 million or more will now operate under the direct supervision of the Bank of Ghana, while smaller cooperatives and susu operators are classified as Last-Mile Providers, under delegated oversight.
The central bank says these thresholds are intended to ensure institutions serving the public are well capitalised, properly governed, and capable of weathering operational shocks.
Institutional categories redefined
The reforms replace the old Tier 1–4 classification with four clear categories: Microfinance Banks, Community Banks, Credit Unions, and Last-Mile Providers.
Microfinance Banks will operate as deposit-taking institutions serving individuals, groups, and micro, small, and medium enterprises.
Community Banks will integrate both rural and urban areas into the financial ecosystem, adopting broader community ownership structures with at least 30% of shares held by community members.
Credit unions with larger assets will be under direct supervision, while smaller cooperatives remain under delegated oversight.
The reforms also introduce maximum shareholding thresholds, ensuring inclusive participation by individuals, groups, and corporate bodies.
Institutions exceeding these limits are required to regularise ownership by the end of 2026.
Transition pathways for institutions
To facilitate compliance, the Bank of Ghana has outlined multiple pathways.
Institutions below the required capital can recapitalise on their own, merge with stronger operators, transfer assets and liabilities to nearby institutions, or exit voluntarily under an orderly winding-up process.
Operators must notify the central bank of their chosen path by June 30, 2026, and submit progress reports by September 30, 2026.
Institutions that fail to act within these deadlines risk sanctions, including restrictions on operations.
Community banks enter a new era
All existing Rural Banks are required to convert into Community Banks by March 31, 2026.
Following conversion, they must meet revised regulatory and capital requirements by December 31, 2026.
Community Banks will be licensed deposit-taking institutions with a focus on integrating their communities into the national financial system.
Broader community ownership, transparent governance, and capital adequacy are expected to strengthen the sector and enhance depositor confidence.
Microfinance banks and expanded mandate
Existing savings and loans companies, finance houses, deposit-taking microfinance companies, and micro-credit firms can transition into Microfinance Banks, provided they meet the new capital requirements.
The central bank emphasises that these reforms are designed to modernise the sector, improve risk management, and enhance financial inclusion for households and small businesses.
Credit unions and last-mile providers
Credit unions with assets above GH¢60 million will fall under direct supervision, while smaller cooperatives and susu operators are classified as Last-Mile Providers.
These reforms aim to bring greater regulatory oversight while preserving operational flexibility for smaller, community-based institutions.
Central hub for sector support
The role of ARB Apex Bank Limited has been expanded to provide shared services across Microfinance Banks, Community Banks, and licensed Credit Unions.
These include emergency liquidity support, reserve management, cheque clearing, specie movement, fund management, and common digital infrastructure such as banking platforms and ATMs.
ARB Apex Bank will also coordinate inspections, training, and policy implementation, offering temporary support for distressed institutions and helping to ensure stability across the sector.
Stability, confidence, and inclusion
The Bank of Ghana stresses that the reforms are not intended to close institutions but to modernise the sector, improve governance, and safeguard deposits.
Mergers, acquisitions, and transfers of assets and liabilities will be conducted with depositor protection in mind, including at least 30 days’ notice before major changes.
The central bank expects these reforms to create a more resilient, well-capitalised, and professionally governed microfinance sector capable of supporting small businesses, households, and broader financial inclusion while reducing risks that have historically threatened stability.
Key compliance deadlines
March 31, 2026
Conversion of all Rural Banks into Community Banks.
June 30, 2026
Institutions must notify Bank of Ghana of chosen compliance pathway.
September 30, 2026: Progress reports due.
December 31, 2026
Full compliance with new capital, governance, and regulatory requirements.
With these reforms, Ghana’s microfinance sector enters a new era of professionalism, resilience, and inclusive financial growth, positioning Community Banks, Microfinance Banks, Credit Unions, and Last-Mile Providers to better serve communities and strengthen the national financial system.
