Banks to suspend lending to public sector workers under Controller and Accountant General’s payroll
Banks have begun moves to suspend lending to public sector workers under the Controller and Accountant-General’s (CAGD) payroll scheme. This has become necessary due to the growing non-performing loans in the banking industry. The Chief Executive of the Ghana Association of Banks, John Awuah, told Journalists at the Association’s Annual General Meeting that the rising […]
Banks are planning to suspend lending to public sector workers who are under the Controller and Accountant-General’s (CAGD) payroll scheme. This decision comes as public sector loans are experiencing a surge in defaults, straining the banking industry. John Awuah, the CEO of the Ghana Association of Banks, addressed journalists at the Association’s Annual General Meeting about the looming action.
Awuah stated that the rising non-performing loans are a significant challenge and that the banking sector needs to reduce these defaults below 10.0% by the next year. This move was mandated by the Bank of Ghana Governor, Dr. Johnson Asiamah. Awuah emphasized that the banking industry cannot continue to operate with loans being repaid, but the lending process is hindered due to non-payment of borrowed funds.
Despite previous discussions, the action has been delayed due to interference from higher authorities. However, Awuah assured that the action will proceed in the coming days or weeks. The Ghana Association of Banks has also been tasked to collaborate with the Bank of Ghana in creating a framework for the complete implementation of the Lenders and Borrowers Act.
Written by urgent.news from MyJoyOnline Ghana's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
