Introduction to Non-Interest Banking in Ghana
Professor John Gatsi, an advisor to the Governor of the Bank of Ghana (BoG) on Non-Interest Banking and Finance, has revealed that the central bank is working on a comprehensive framework for non-interest banking. This initiative aims to preserve the country’s secular identity while ensuring market neutrality across the financial system.
The new framework is expected to enhance financial inclusion, but it will do so within a regulatory model that avoids overt religious affiliation and ensures equal access for all citizens. Initially, the scope of non-interest banking will be limited, excluding microfinance institutions, rural banks, and community banks.
Phased Strategy for Implementation
Prof. Gatsi explained that this phased approach will allow the regulator to identify implementation challenges early, strengthen compliance systems, and build institutional capacity before expanding the framework to other segments of the financial sector.
He emphasized that institutions seeking to operate under the new regime must not use names or branding that suggest any religious association—whether Islamic, Christian, or otherwise. “We must preserve the neutrality of the market,” he said, noting that non-interest banking in Ghana will not be driven by religious identity but by ethical financial practice and inclusivity.
Regulatory Foundation and Financial Practices
The regulatory foundation for this initiative is based on Act 930, the Banks and Specialised Deposit-Taking Institutions Act, 2016. This legislation already provides for key prudential standards, including anti-money laundering (AML) provisions, liquidity management, and sources of capital.
Prof. Gatsi also explained that liquidity management for non-interest institutions will be guided by asset-backed structures and risk-sharing models rather than conventional interest-based instruments. However, these institutions will still meet the same prudential benchmarks.
Expansion Beyond Banking
The new framework will not only cover banking but also extend to capital markets and insurance. BoG is collaborating with other financial sector regulators, including the Securities and Exchange Commission (SEC) and National Insurance Commission (NIC), to finalise harmonised guidelines for Sukuk (non-interest bonds) and Takaful (non-interest insurance).
Timeline and Capacity-Building Initiatives
Prof. Gatsi revealed that the draft non-interest banking guideline is currently undergoing internal validation at the BoG and will soon be presented to the Governor for review and approval. Publication of the final document is expected by the end of 2025.
To support the rollout, BoG will host a capacity-building programme on December 1, 2025, for banks, insurers, and capital market players.
Key Considerations for Non-Interest Banking
- The framework prioritizes secular values and market neutrality.
- Institutions must avoid any religious branding.
- Liquidity management will rely on asset-backed structures and risk-sharing models.
- Collaboration with other regulators is essential for harmonized guidelines.
- The initiative includes expansion into capital markets and insurance.
- A capacity-building programme is planned for late 2025.
Conclusion
As the Bank of Ghana moves forward with its non-interest banking framework, the focus remains on creating a fair, inclusive, and ethically sound financial system. By ensuring neutrality and promoting financial inclusion without religious influence, the initiative aims to benefit all citizens while maintaining high regulatory standards. With collaboration across sectors and a structured implementation plan, the future of non-interest banking in Ghana looks promising.