Ghana to amend Borrowers and Lenders Act

Ghana’s Borrowers and Lenders Act 773 will soon be amended, the country’s Finance Minister Seth Terpker disclosed in Accra today May 8, 2013.

The Minister made this known at the launch of Ghana’s newly redesigned web-based Collateral Registry run by the central bank.

The ACT 773 which was passed by Parliament in 2008 was to provide the legal framework for credit, improve standard of disclosure and prohibit certain practices in the credit market.

The country then commenced full implementation of the Act in 2009.

Despite the immense contribution of the Act to Ghana’s financial sector, the Finance Minister  has admitted “a few challenges” and said both the government and the Bank of Ghana (BoG) with the help of other stakeholders in the credit market are addressing those challenges.

Mr Terpker went on to mention that there are some gaps and inadequacies about the Act in respect to secured transactions standards and international best practices.

“To address these, government and the BoG in a collaborative effort with the IFC [International Finance Corporation] have prepared an amendment to Act 773,” Mr Terpker said.

He indicated that the Finance Ministry through Cabinet will forward it to Parliament for consideration.

Mr Terpker acknowledged the problem of duplication of registration and disjointed records associated with the absence of harmonization between the Collateral Registry and other registries in the country.

The Collateral Registry is a body established by Parliament under the Act 773 to principally register charges and collaterals created by borrowers to secure credit facilities provided by lenders.

By Ekow Quandzie