News Guide Africa

Tag: Non-Interest Financial Advisory Council (NIFAC)

  • Foreign investors eye Ghana’s Non-Interest Banking market as BoG clears regulatory pathway

    Foreign investors eye Ghana’s Non-Interest Banking market as BoG clears regulatory pathway

    By Adnan Adams Mohammed

     

    Foreign institutional investors and alternative finance capital are positioning for major entry into Ghana’s financial sector following the Bank of Ghana’s (BoG) formal activation of the Non-Interest Financial Advisory Council (NIFAC).

    The new regulatory framework signals a lucrative opening for global non-interest banks, private equity firms, and asset management funds seeking high-yield opportunities in West Africa’s expanding alternative finance market. By establishing clear oversight under Act 930, Ghana is clearing legal hurdles to attract long-term foreign direct investment into asset-backed infrastructure, leasing, and commercial trade projects.

    Inaugurating the advisory council at the central bank headquarters, Bank of Ghana Governor Dr. Johnson Pandit Asiama highlighted that the regulatory shift provides foreign and domestic investors with a reliable framework to deploy alternative capital models alongside conventional banking.

    “Non-interest finance widens that choice. It is not free finance, but a complement to conventional banking based on trade, leasing, partnerships, and asset-backed transactions,” Dr. Asiama noted.

     

    For international financial institutions, the newly released Guideline for the Regulation and Supervision of Non-Interest Banking creates two distinct market entry strategies: foreign banks can establish fully owned non-interest subsidiaries or license specialized windows through existing Ghanaian commercial entities.

    Dr. Asiama reassured investors and market participants that regulatory approval for new financial products will prioritize structural clarity, consumer confidence, and systemic stability to protect capital deployments.

    “The success of this initiative will not be measured by the number of new products introduced, but by whether those products are sound, useful, and worthy of public confidence,” Dr. Asiama asserted. “Products should not be accepted merely because they carry a non-interest label. Their structure, risks, costs, and obligations must be transparent.”

     

    Chaired by renowned regulatory expert Prof. Bashir Aliyu Umar, the cross-border council is tasked with advising the BoG while extending technical support to the Securities and Exchange Commission (SEC) and the National Insurance Commission (NIC). This multi-agency alignment is expected to accelerate the issuance of alternative capital market instruments including sovereign and corporate Sukuk bonds opening direct channels for international portfolio investors seeking yield in West Africa.

     

  • Catholic expert’s appointment to NIB Advisory Council crushes ‘Islamisation’ fears

    Catholic expert’s appointment to NIB Advisory Council crushes ‘Islamisation’ fears

    By Adnan Adams Mohammed

    In a historic move that signals the imminent launch of Ghana’s first fully licensed Non-Interest Banking (NIB) institution, the Bank of Ghana (BoG) has announced the appointment of two prominent industry experts to the Non-Interest Financial Advisory Council (NIFAC).

    Crucially, the consideration of a devout Catholic to the apex advisory council has effectively diffused long-standing public misconceptions that non-interest banking, often associated with Islamic finance principles, is an attempt to secretly “Islamise” the nation’s financial system.

    The yet to be fully constituted NIFAC is tasked with reviewing and approving the first suite of financial products to be rolled out by incoming institutions, ensuring strict compliance with non-interest banking (NIB) principles before they hit the commercial market.

    Bridging the Faith Divide

    For years, the introduction of non-interest or ethical banking sparked quiet apprehension among segments of the public who viewed it strictly through a religious lens. However, the central bank’s decision to appoint a high-profile Catholic finance expert to NIFAC has completely shifted the narrative toward financial inclusion rather than religious dominance.

    Speaking on the condition of anonymity shortly after appointment letters were dispatched, the Catholic council member expressed deep optimism about the sector’s secular benefits.

    “When I was approached for this role, I saw it not as a religious calling, but as an economic duty,” he stated. “Non-interest banking is built on ethics, risk-sharing, and asset-backed transactions. As a Catholic, these values of fairness and community empowerment resonate deeply with my own faith. This is about giving Ghanaians more options, not changing their religion.”

    The expert further addressed the lingering myths surrounding the financial framework.

    “There has been a persistent misconception that introducing these frameworks is a backdoor strategy for ‘Islamisation.’ That narrative is entirely unfounded. If a Catholic can sit at the highest advisory level to regulate these products, it proves that this is a universal, ethical economic tool designed for all Ghanaians, regardless of their creed.”

    BoG Fast-Tracks First License

    The appointments come on the heels of the Bank of Ghana finalizing its review of application documents submitted by some institutions for ‘Window’ license. Insiders within the central bank confirm that with NIFAC being set up and to be launched soon, the apex bank is on the verge of issuing its very first independent non-interest banking license in earnest.

    Dr. Johnson Pandit Asiama, Governor of the Bank of Ghana, has previously emphasized that the framework is meant to expand financial access to underserved populations, particularly small-to-medium enterprises (SMEs) that struggle with conventional high-interest loans.

    “Our objective is to create an all-inclusive financial ecosystem,” the Governor remarked. “By bringing in a diverse stock of top-tier experts, we ensure robust regulatory oversight. This council will guarantee that these new products strictly protect consumer interests while driving national economic growth.”

    Industry Applauds the Move

    Financial analysts and religious leaders alike have praised the central bank’s inclusive approach to composing the advisory council. Banking consultant Kwame Mensah noted that diversifying the council is a masterstroke in public relations and regulatory policy.

    “The central bank has handled this brilliantly,” Mensah said. “By ensuring the council isn’t monolithic, they have effectively decoupled the financial utility of non-interest banking from religious politics. It sends a clear message to investors and consumers that this is purely business, equity, and asset-based development.”

    As the newly appointed experts assume their roles, the testing of system compliance is entering its final stages. With the regulatory roadblocks cleared and the “Islamisation” myth successfully debunked, Ghanaians can expect the launch of the country’s premier non-interest bank in the coming months, ushering in a new era of competitive, interest-free financial alternatives.

     

     

     

  • BoG set to license first Non-Interest Bank soon …as two industry experts are appointed to NIFAC

    BoG set to license first Non-Interest Bank soon …as two industry experts are appointed to NIFAC

    By Adnan Adams Mohammed

    The Bank of Ghana (BoG) is set to issue its first operational license for a non-interest banking institution before the end of 2026.

    The milestone follows a rigorous regulatory process designed to seamlessly weave alternative finance into the nation’s existing financial architecture.

    Central bank Governor Dr. Johnson Pandit Asiama revealed the timeline during the central bank’s Monetary Policy Committee (MPC) press briefing last week. Responding to a question regarding how the new framework would deepen local financial inclusion and blend into Ghana’s liquidity management framework, Dr. Asiama expressed immense optimism.

    “That is something that is dear to my heart,” Dr. Asiama stated. “We are all waiting to see the launch of the first non-interest banking institution. A lot has been done… Hopefully this year we will see the first license.”

    Rigorous regulatory oversight

    While the introduction of non-interest banking is widely anticipated to absorb a large segment of Ghana’s unbanked population, particularly businesses and individuals seeking ethical alternatives, the apex bank is taking no shortcuts regarding regulatory oversight.

    Dr. Asiama assured the public that incoming institutions are undergoing intense scrutiny to guarantee macroeconomic stability.

    “They are working very hard, putting in place the structures. The regulatory structures are very, very stringent, I can assure you. This is best practice. So I have no fears about that at all,” the Governor explained.

    NIFAC formed to guide governance

    Crucial to the operationalization of Non-Interest Banks (NIBs) is the official formation of the Non-Interest Financial Advisory Council (NIFAC). The council is tasked with providing expert, high-level advice on governance and compliance directly to the Bank of Ghana.

    In alignment with the central bank’s strict adherence to inclusive corporate governance, information this paper is privy to tells that, two highly respected financial professionals have been appointed to serve as NIFAC members

    Appointed NIFAC Member Professional Background Key Specialization

    Dr. George Baah-Danquah Fellow, ICAG & CICT; Banking & Treasury Expert Treasury Management, Corporate Governance, Corporate Banking

    Adishetu Hamidu Naabo Principal Economic Officer, Ministry of Finance Fiscal Policy, Non-Interest Financial Frameworks, Public Finance

    Dr. George Baah-Danquah, a fellow of the Institute of Chartered Accountants, Ghana (ICAG) and the Chartered Institute of Corporate Treasurers (CICT), brings decades of robust banking and treasury experience to the table. Notably, Dr. Baah-Danquah is a devout Christian who worships with the Catholic Church, a testament to the Bank of Ghana’s strategy to ensure that non-interest banking is recognized not as a religious monopoly, but as an inclusive, ethical financial model for all Ghanaians.

    Pursuant to the Non-Interest Banking Guidelines, which intentionally mandate gender diversity within its leadership framework, the central bank has also appointed Adishetu Hamidu Naabo. As a Principal Economic Officer at the Ministry of Finance, Naabo has spent years directly spearheading technical state policy on non-interest banking systems.

    A collaborative ecosystem

    The push toward realizing a functional non-interest banking ecosystem has relied heavily on collaborations between academic experts, state ministries, and internal regulators. During the briefing, Dr. Asiama credited academic and financial expert Professor John Gatsi for his foundational contributions to the development of the framework.

    “We give Professor Gatsi a lot of credit for the work he has done,” Dr. Asiama noted.

    To safely manage liquidity and integrate these specialized entities into the wider banking system, the central bank’s internal watchdogs are working hand-in-hand with incoming operators.

    “The necessary structures are being put in place to ensure that non-interest banking thrives and thrives well. The head of banking supervision is also fully involved,” the Governor assured.

    The successful rollout of non-interest banking is anticipated to provide alternative, low-risk capital pools for small and medium-sized enterprises (SMEs), reduce the national unbanked rate, and promote financial diversity within the Ghanaian macro-economy.