The Ghana Association of Microfinance Companies (GAMC) is bracing up to protect the industry and help safeguard funds of depositors.

The business group is to operate under the second tier of the regulated microfinance institutions, which include susu companies taking deposits and making profits.

Under the new Bank of Ghana operating rules and guidelines, firms under this category shall hold an initial minimum paid-up capital of not less than Gh¢100,000.00 for one unit office.

According to Collins Amponsah-Mensah, the National Board Chairman of the GAMC, over 350 companies have so far been registered with the association and ready are ready to be regulated.

He expects 700 more to be registered by end of year to be licensed to operate as microfinance companies.

The new licensing requirements were expected to take effect within from January 2012.

“The deadline has ended”, Mr. Amponsah-Mensah told Luv Biz Report. “We’ve not officially been informed of any extension. We are just encouraging our members to take advantage of the seemingly relaxed posture of the regulator to file for licensing”, he added.

Mr. Amponsah-Mensah said the Association will be seeking public cooperation to flush out unscrupulous microfinance operators in the system.

He has also cautioned the public against giving money out without cross-checking the background of the receiving company.

Meanwhile, the Ministry of Finance and Economic Planning is building the capacity of the microfinance institutions to offer qualitative micro credit to rural farmers and other businesses.

This is part of the Ministry’s Rural and Agriculture Finance Programme (RAFiP), which supports improved agriculture and sustainable livelihood of the rural poor.

Microfinance companies from the northern sector of the country participated in one of such capacity building programmes in Kumasi.

Mr. Amponsah-Mensah has lauded the Ministry for providing a 60 percent subsidy for the cost of training members.

He noted that capacity building is critical for microfinance firms to better manage on-lending funds to boost agriculture financing.