The Bank of Ghana has taken steps to enhance regulatory oversight of the proposed non-interest banking sector by introducing a new set of prudential regulations.
According to a draft guideline released for consultation, non-interest banking operators that are foreign-owned will be mandated to invest a minimum of 60 percent of their required capital in convertible foreign currency, which must be allocated solely to Shariah-compliant financial instruments.
For the first time, foreign-owned non-interest banks and specialized deposit-taking institutions will be obligated to maintain a higher standard of capital, with at least 60 percent of their minimum paid-up capital needing to be in convertible foreign currency.
Furthermore, this capital must be exclusively utilized for approved non-interest, Shariah-compliant financial instruments.
The Central Bank has stated that this strategy aims to ensure stability, mitigate currency and liquidity risks, and enhance the resilience of operators in an industry that continues to draw new participants.
As part of this framework, the Bank of Ghana will establish minimum capital requirements and application fees for all types of Non-Interest Financial Institutions, including development finance institutions, microfinance companies, and rural banks.
Final licenses will only be granted once institutions have paid the necessary licensing fees, and all operators are required to pay annual supervisory fees by January 31 of each year.
The BoG will also retain the authority to impose additional capital buffers when deemed necessary.
The guideline, based on Act 930 and Act 1032, requires that all non-interest operators conduct their financial, investment, trading, and commercial activities in strict accordance with recognized non-interest financial principles.
Additionally, it specifies governance standards, permissible financing contracts, and the operational framework for the Non-Interest Financial Advisory Council and the Non-Interest Banking Advisory Committee.
