The Bank of Ghana (BoG) is in talks with members of the Ghana Co-operative Susu Collectors Association (GCSCA), the umbrella body of 'susu' collectors, to develop an insurance scheme for clients of susu businesses throughout the country. The move, according to the Central Bank, forms part of regulatory mechanisms being devised for the group and the country’s micro-finance sector in general. The Head of Banking Supervision Department (BSD) at the Central Bank, Mr Franklin Bengle, who made this known to the Daily Graphic, explained that the mechanism was to “help insulate clients of the 'susu' service against risks of losing their money to unscrupulous collectors. “We are in talks with the GCSCA to set up an insurance fund for their members so that if people lose their money through this business (the 'susu' collection), then the victims can easily be catered for by funds from the insurance fund,” Mr Bengle added. The said insurance scheme would thus provide claims for 'susu' contributors who fell victim to fraudulent collectors. The successful implementation of the fund could possibly endear the 'susu' business to many individuals and business institutions in the country by helping to erase the present fear among many people that a collector may run away with their collections. Mr Bengle, however, noted that the Central Bank was “not comfortable with allowing the collectors to give out loans to interested clients” because they do not have liquidity ratios. Liquidity ration is the amount of money held by a financial institution, in most cases a bank, as a proportion to its deposits and is normally measured by the extent to which the said institution or another entity can quickly liquidate assets to cover short-term liabilities. “You know these collectors don't have a liquidity ratio that they can easily fall on to defray their debts,” the head of BSD at the central bank said, adding that the bank was thinking of “allowing them to do concessionary lending by using the GCSCA as an institution to secure funds from other bigger financial service providers. “And when that happens, GCSCA will guarantee for those funds and then monitor the disbursements, usage and retrieval of those funds,” he noted. On regulations for the micro finance sector so far, Mr Bengle said the bank had started receiving some applications from some of the institutions that were given the six-month period to re-register or cease operations. He said BoG was “trying to encourage self regulation of these institutions,” explaining that although the bank would at the end act as the overseeing body of these institutions, the BoG was “trying to get the umbrella bodies to enforce these regulations among their respective members. “We want to get the umbrella bodies of these microfinance institutions to self regulate themselves. We want to put some peer pressure on them to make sure that their members do not go contrary to the guidelines of the bank. “With this, the BoG can now also extend its influence as the overall regulator of the entire process,” Mr Bengle added.