Banking Consultant, Nana Otuo Acheampong has implored Savings and Loans companies to exercise restraint in their quest to operate as banks as the implications could be dire.
The Ghana Association of Savings and Loans Companies earlier warned that unfavorable conditions in the industry is compelling most of their members to pursue universal banking status.
The companies are pursuing the move even though they do not have the capital strength to become banks.
A development, some analysts believe has partly contributed to the challenges facing the financial sector.
Nana Otuo Acheampong also maintains a wholesale leap unto banks could affect the financial industry negatively.
â€œPresently, with their level of capital, they will be able to quote the security because the way our cheque issue works is that once you are in clearing, when your cheque comes, whether there is money in your account or not the regulator has to pay the money and so you have to have a resizeable level of capital,â€ he explained.
â€œThat is why I said once their minimum capital is increased to a reasonable level like 50 million, then they may be considered and administered into clearingâ€ he added.
He further advises the finance institutions to equally consider lending to microfinance companies as there are opportunities for such category of persons within the financial system.
â€œThey should not rush, because there is always room for the micro sector as well. Not everybody wants a hundred million loan, there are people who want the thousands also. So that is a niche market and they should concentrate on that,â€ he advised.