The Bank of Ghana has officially extended by 6 months, the deadline for meeting the new minimum capital requirements by all existing Payment Service Providers, Electronic Money Issuers, banks and specialized deposit-taking institutions, from June 30, 2020 to December 31, 2020.
To operationalize the new Payment Systems and Services Act, 2019 (Act 987), which sought to provide the legal and regulatory framework for the orderly development of Ghana’s payment system, the Bank of Ghana back in September 2019, spelt out minimum capital requirements, permissible activities and fees for all categories of payment service providers and financial technology companies, including a minimum capital requirement of GH¢20 million Ghana Cedis for Mobile Money Operators.
But according to a new notice by the Bank of Ghana, the deadline for meeting the new minimum capital requirements, as well as the minimum infrastructure and governance requirements, has been extended from June 2020 to December 2020.
In addition, all existing financial technology firms that intend to integrate with GhIPSS are required to meet GhIPSS’ minimum security and control requirements by December 31, 2020.
The statement also added that the deadline for meeting the Payment Card Industry Data Security Standard (PCI-DSS) and ISO 27001 certification requirements, has been extended from June 2020 to December 2020.
This applies to all existing Electronic Money Issuers and Payment Service Providers that fall under the licence category required to meet the above certification.
BoG requirements
The central bank last year raised the minimum capital requirements for payment service providers from GH¢5 million to GH¢20 million.
Justifying the decision, the central bank said, “The emergence of new payment streams, institutions such as financial technology companies and the general acceptance of electronic money have necessitated the enactment of the Payment Systems and Services Act, 2019 (Act 987) to provide the legal and regulatory framework for the orderly development of the payment system.”
A release issued by the bank further noted that: “To operationalize Act 987, the Bank of Ghana hereby provides the minimum capital requirements, permissible activities and fees for all categories of payment service providers and financial technology companies.”
According to the Payment Systems and Services Act, 2019 (Act 987), all mobile money operators need to set up a subsidiary and will have to seek approval from the Bank of Ghana.
The Breakdown
The BoG in the statement grouped the various licences under the Payment System Providers (PSP) into five – PSP Electronic Money Issuer – GH¢20 million, PSP Scheme (Payments cards like Visa and MasterCards) – GH¢8 million, PSP Enhanced Licence (Payment Platforms like ExpressPay etc) – GH¢2 million, PSP Medium Licence (Sub agents for the payment platforms) – GH¢ 800, 000 and Standard Licence (startups fintechs.) – No capital required.
Ghana going cash-lite
The Bank of Ghana has set 2024 as a deadline for the country to move towards an era where little cash is used in financial transactions.
The move is part of efforts to reduce the cost of doing business and improve revenue collections in the country.
The government has said it would start electronic payments for its services from June this year. This has been influenced by mobile number interoperability.
A 2016 Bank of Ghana Report revealed that the use of physical cash as the medium of exchange was on a continuous decline due to the increase in the use of other sources of payment, including cards, mobile money and the Ghana Interbank Payment and Settlement Systems (GhIPSS) Instant Pay.
Source: Citinewsroom.com
