Checks obsolete in 5 years – Bawumia

Company News of Monday, July 8, 2019

Source: clbadfmonline.com

2019-07-08

Ghana's vice president, Mahamudu Bawumia, predicted that Ghana's rapidly evolving payment system under the digitization program would soon make obsolete controls for the payment of goods and services in Ghana.

Speaking at the closing ceremony of the 2019 summit of the diaspora on Saturday, July 6, the Vice President pointed out that with the introduction of interoperability of the Mobile money, the use of checks is declining. Currently, mobile money payments account for 70% of payments and checks are constantly losing ground for electronic payments.

The vice president noted that the situation of checks would only worsen with the imminent introduction of a universal QR code platform for payments in Ghana, which would result in an instant payment and a credit of the accounts. Checks will slowly become obsolete cases in countries like Namibia. Thanks to the universal QR code, Ghanaian merchants will no longer need a point-of-sale terminal to receive their payments. They will only need a cell phone. Merchants as small as street vendors will be covered by the universal QR code. Their bank accounts or mobile money will be instantly credited. "If your account can be credited instantly, why are you going to worry about checks?" the vice president questioned. Countries that have recently introduced the universal QR code system are Singapore, India and China.

On May 10, 2018, the Bank of Ghana launched the Mobile Interoperability System via Ghana, the Interbank Payment and Settlement System (GhIPSS), to eliminate the complexities and drawbacks badociated with to transfers on different mobile networks. This makes possible the accelerated growth of the cashless economy envisioned by the Akufo-Addo administration.

Last year, the average transactions with the introduction of interoperability of mobile money was established at about 280,000 transactions, a difference of more than 200%. Money transfers between mobile networks were made approximately 2.2 million times between May and December last year.

The interoperability system for mobile money is of paramount importance to Ghanaians as it saves time and reduces travel expenses to the agent. The recipient gets instant access to the digital currency. This is safer because there is already a growing body of research that shows that when a company uses less money, the crime rate goes down and the feeling of personal safety decreases.