Home BusinessBanking Ghana: Regulating Crowdfunding – BoG Releases Policy

Ghana: Regulating Crowdfunding – BoG Releases Policy

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The Bank of Ghana (BoG) has issued a policy to promote and guide the development and use of crowdfunding products and services.

The policy seeks to ensure that crowdfunding services complied with data protection and customer privacy regulations, good governance and accountability, relevant Anti-Money Laundering and Combating the Financing of Terrorism norms, liquidation procedures and the protection of contributors’ interest.

A statement issued by BoG in Accra on Friday and signed by its Secretary, Ms Sandra Thompson, said under the policy, the general public was to access crowdfunding products provided by regulated entities, for their donation needs, for improved disclosure, transparency and accountability.

Locally known as “susu”, “nnoboa” or “ntoboa”, crowdfunding involves the collection of funds, usually in small amounts from individuals, to support projects or causes and has been traditionally employed by families, groups or communities to mobilise money to meet the needs of their members.

BoG indicated that policy was in line with its commitment to promote the modernisation of the banking industry, in a manner that meet the needs of diverse groups of people, so as to promote financial inclusion.

The BoG explained that market women, farmers, fishmongers, traders, among other groups, had used crowdfunding as an instrument in the mobilisation of critical funds to meet the pressing needs of members to raise capital for businesses, payment of medical bills, funeral contributions and children’s education.

“With the introduction of mobile money, associations and corporate entities have found crowdfunding to be an efficient channel for collecting donations and for raising funds. Mobile money platforms have been used to raise funds for old student association contributions, development contributions, funeral donations and donations towards medical expenses of vulnerable persons,” BoG said.

It said the development signaled the potential of digital platforms in transforming the traditional crowdfunding model to enhance its contribution to the implementation of the National Financial Inclusion Strategy and the Digital Financial Services Policy objectives of the country.

Within the last ten years, BoG indicated a number of laws had been passed and directives issued to position the financial sector to leverage digital technology for inclusive growth.