Microfinance Companies in the country have been asked to merge, as part of moves to strengthen and consolidate institutions in the sector.

The consolidation of the existing institutions, according to the Other Head of Financial Institutions Supervision Department of the Bank of Ghana (BoG) is needed to strengthen members of the association to be able to deliver the needed financial support to businesses in the microenterprise sector.

Patience Yeboah-Nkansah made the call at the 6^th Annual General Meeting (AGM) of the Ghana Association of Microfinance Companies (GAMC) in Accra.

The event which on the theme: ‘Positioning Microfinance Companies to Facilitate Financial Inclusion’ provided a platform for interaction among GAMC members and the regulator with focus on information dissemination as well as addressing consumer concerns.

Mrs. Yeboah-Nkansah revealed that there are currently 568 licensed microfinance institutions, comprising 484 deposit taking microfinance companies, 71 money lending companies and 12 financial non-governmental organisations in the country.

She, therefore, suggested  thus a merger will help them regulate the sector effectively.

She noted that, the Central Bank has suspended the issuance of new licences to investors seeking to operate microfinance companies.

A move, she stated is to help existing institutions to address their inherent challenges before the issuance of the new operating guidelines.

The Bank, Mrs. Yeboah-Nkansah said has also increased the minimum paid up capital for microfinance companies and money lending companies from GHC500, 000 and GHC300,000 respectively to GHC 2,000,000 and that all existing microfinance institutions have up to December 2018 to meet the capital requirements.

So to prevent the sector from collapsing, she added that, a merger of microfinance companies will force the commercial banks to be more creative and innovative with bringing out products and services that bring about extensive financial inclusion.

Also, Executive Secretary of GAMC, Joseph Kwame Donkor said the association has introduced a new set of business regulations and logo to distinguish between credible, licensed microfinance institutions and unlicensed ones to effectively regulate the microfinance industry.

He underscored the need for boards of the companies to act collectively with management to put some orderliness in their operations.

Mr. Kwame Donkor pledged the continued collaboration of GAMC with BoG and other stakeholders in an effort to promote a stable, safe and sound environment that would enable member institutions to provide financial services more responsibly.