Ghana’s financial sector is poised for greater diversification and inclusion as the Bank of Ghana (BoG) moves closer to licensing non-interest banking operations, a development expected to expand access to alternative financing and support small and medium-sized enterprises (SMEs).
Governor of the BoG, Dr Johnson Pandit Asiama, said the Central Bank was ready to receive and process applications from financial institutions interested in offering non-interest, or Islamic, banking services, citing rising investor interest in the sector.
Although he did not indicate a specific timeline, Dr Asiama expressed optimism that formal licence applications would be submitted soon, paving the way for the sector’s operationalisation.
He made the remarks at a press briefing following the 128th Monetary Policy Committee (MPC) meeting, where the BoG announced a 250-basis point cut in the policy rate, reducing it from 18 per cent to 15.5 percent.
According to the Governor, preliminary engagements with prospective investors were already underway, with several institutions conducting due diligence and regulatory checks ahead of submitting applications.
“A number of potential investors are writing to us and doing the necessary checks. So, we are optimistic that very soon, we may be able to see a formal application for a licence that we can review and take things forward,” Dr Asiama said.
The move follows progress made since the Central Bank announced plans to operationalise non-interest banking last year. This has included extensive stakeholder consultations and the publication of regulatory guidelines to steer conduct and operations within the sector.
Non-interest banking operates on principles that prohibit interest-based transactions, excessive uncertainty, speculative activities and the financing of prohibited businesses. Instead, it emphasises profit-and-loss sharing and asset-backed financing.
For the Bank of Ghana, the introduction of non-interest banking is intended to deepen financial inclusion, mobilise alternative sources of capital, support sustainable economic growth and create employment, while remaining consistent with the Bank’s mandates of price stability, financial stability and economic development.
Professor John Gartchie Gatsi, Advisor to the Governor on non-interest banking, has reiterated the strategic importance of the sector, describing it as a practical financial alternative rather than a religious instrument.
He explained that non-interest banking, though founded on Islamic finance principles, provides financing without interest charges, with returns shared based on agreed profit-and-loss arrangements, making it particularly attractive for SMEs.
Prof Gatsi noted that non-interest banking operates successfully in many secular economies, including the United States, the United Kingdom and Malaysia, and should be seen as a complementary system to Ghana’s existing financial architecture.
“This is not about promoting religion. It is about expanding the financial system to mobilise funds and support areas we are currently unable to reach, especially SMEs that struggle under high interest costs,” he said.
Although provisions for non-interest banking exist under the Banks and Specialised Deposit-Taking Institutions Act, 2016 (Act 930), a comprehensive operational framework was only finalised in 2025, clearing the path for licensing and implementation.
With regulatory structures now in place and investor interest growing, the anticipated rollout of non-interest banking is expected to mark a new chapter in Ghana’s financial sector development.
