The Managing Director of the ARB Apex Bank, Kojo Mattah has maintained that most of the rural and community banks operating in the country are well capitalized and serving their clients, contrary to reports that majority of them are struggling.

He stated that the services rendered by rural banks are critical to the economic stability of the country.

Read: ARP Apex Bank urges customers to pay back loans

“I can tell you that most of the rural and community banks are well capitalized and operating very well” he said adding that there is no need for panic withdrawals.

According to him, over six million Ghanaians have different accounts with rural banks, making the industry a crucial one in closing the gap between the unbanked and banking population.

Concept of rural banking

The rural and community banking concept was introduced in 1976 with a view to providing financial intermediation in rural areas.

Typically, there are about 140 rural and community banks in Ghana with over 700 branches spread across the 16 regions.

One important factor about rural and community banks is that they operate in areas universal banks may refuse to operate.

For now some stakeholders in the financial sector have called on the Bank of Ghana to conduct an audit of the sector and publish names of rural banks in good standing.

This may however take a while as the central bank prepares to move to the Savings and Loans sector as its next stop for cleaning the financial sector.

Source: citibusinessnews.com