The Governor of the Bank of Ghana (BoG), Dr Johnson Pandit Asiama, has announced major reforms to Ghana’s rural banking sector, including its transition to community banking and the introduction of urban community banks, describing the changes as essential to expanding financial inclusion and supporting economic development.

Speaking at the Rural Banking@50 celebration and the transition to Community Banking event held at Bank Square in Accra on Thursday, July 16, Dr Asiama said the reforms would ensure that community-based financial institutions continue to serve the needs of Ghanaians while adapting to changing economic realities.

Addressing participants, the Governor said the Bank of Ghana had increasingly focused on identifying practical ways of complementing government efforts to reduce poverty through improved access to financial services.

He noted that expanding financial inclusion remains one of the most effective ways of improving livelihoods and creating economic opportunities across the country.

“It is established that if we improve access to finance across the populace, that will help lift people out of poverty. That is why the concept of rural banking, bringing banking to the doorstep of ordinary people, remains so relevant,” he said.

Dr Asiama paid tribute to the late Dr Amon Nikoi, the former Governor of the Bank of Ghana who introduced the rural banking concept in 1976, describing his vision as one that fundamentally transformed financial services in Ghana.

He also honoured the late Mr Emmanuel Asiedu-Mantey, a former Head of Banking Supervision at the Bank of Ghana, whom he described as one of the strongest advocates for community-based banking.

According to the Governor, Mr Asiedu-Mantey was his first supervisor when he joined the central bank three decades ago and remained deeply committed to strengthening the rural banking model throughout his career.

Dr Asiama revealed that after his appointment as Second Deputy Governor in 2016, he invited Mr Asiedu-Mantey to lead a committee to review the rural banking framework and recommend reforms capable of repositioning the sector for future growth.

Although he later left office before the review was completed, Dr Asiama said he revisited the committee’s report after returning as Governor and decided to revive its recommendations alongside the ongoing microfinance sector reforms.

He asked participants to observe a moment of silence in memory of Mr Asiedu-Mantey, who passed away last year.

“Those who deserve honour must be honoured,” he said.

Reflecting on the history of the sector, Dr Asiama recounted how Ghana established its first rural bank in Nyakrom in the Central Region, describing it as a landmark moment in the country’s financial history.

Unlike conventional banking expansion, he explained, the initiative was designed to allow communities to establish and own their own financial institutions rather than merely hosting branches of existing commercial banks.

“Everything else — the 50 years, the 147 institutions today, the eight million customers — all grew out of that one decision in one town in the Central Region,” he said.

He noted that before the introduction of rural banking, many farmers, traders and small business owners generated significant economic value despite having little or no access to formal banking services.

Farmers producing export crops, traders supplying local markets and rural entrepreneurs often had to save, borrow and conduct business outside the formal financial system because commercial banks were largely absent from their communities.

The Governor said the partnership between the Government of Ghana and the Bank of Ghana sought to address that gap by empowering communities to own financial institutions capable of mobilising local savings and providing credit to support local development.

Within a year of the establishment of Nyakrom Rural Bank, three additional rural banks were licensed at Bawjiase, Bisease and Asiakwa, demonstrating strong demand for community-owned banking institutions.

According to Dr Asiama, rural banks subsequently became instrumental in financing farming activities, supporting small businesses, mobilising savings and facilitating the payment of cocoa farmers through the Ghana Cocoa Board’s Akuafo Cheque Scheme introduced during the 1980s.

He added that the establishment of the Association of Rural Banks and later ARB Apex Bank strengthened operational support for the sector and integrated rural banks into Ghana’s broader financial system.

Today, he said, the sector comprises 147 licensed institutions operating approximately 1,000 branches, serving more than eight million customers and managing assets valued at about GH¢26 billion as of June this year.

Dr Asiama stressed that these figures represent more than institutional growth.

“They are not simply a measure of institutional success. They are a verdict on the original idea,” he stated.

While celebrating the achievements of the sector, Dr Asiama acknowledged that not every rural bank had succeeded over the past five decades.

Some institutions suffered governance failures, resulting in losses that affected not only balance sheets but also public confidence within the communities they served.

“When one failed, the loss was not merely recorded in a supervisory return and forgotten. It was recorded in a community, in its savings, in its confidence and in the faith it had placed in an institution carrying its own name,” he said.

He explained that these experiences had informed the reforms now being introduced by the Bank of Ghana.

“The idea was right. The framework around it must now be strong enough to deserve it,” he added.

The Governor announced that the designation “rural bank” will officially give way to “community bank”, arguing that the previous name no longer reflects the realities of many communities.

He explained that locations classified as rural when the concept was introduced in 1976 have since developed into thriving commercial and peri-urban centres.

“The word ‘rural’ tells us where institutions were located. Community better reflects who they exist to serve,” he said.

Dr Asiama disclosed that the Bank of Ghana had licensed its first community bank, La Community Bank, as far back as 1987, while discussions about transitioning the wider sector had begun in the mid-1990s but were never fully implemented.

He said the anniversary provided the right opportunity to complete that long-awaited transition.

Beyond the name change, Dr Asiama announced what he described as the most significant reform—the introduction of urban community banking.

He explained that financial exclusion has evolved over time.

Whereas many communities previously lacked physical access to banking services, many urban residents today live close to commercial banks yet remain unable to access credit and other financial products.

“A person may live near a bank branch and still be unable to access the financial services they need. Exclusion has not disappeared; it has simply changed its address,” he observed.

He noted that although mobile money, fintech innovations and digital financial services have significantly expanded access to payments, they have not entirely addressed the financing needs of households and small businesses.

According to him, many national financial interventions continue to benefit larger financial institutions without adequately reaching traders, artisans, start-ups and other small enterprises operating within local communities.

To address this challenge, the Bank of Ghana will allow community banks to be established in urban centres where demand exists.

Dr Asiama said future institutions could include names such as East Legon Community Bank, Cantonments Community Bank or Airport Hills Community Bank, stressing that these would not be branches of existing commercial banks but independently licensed community-owned financial institutions established to support businesses and residents within those neighbourhoods.

“They will lend to the trader who works there, the artisan who lives there and the young entrepreneur building a business there,” he said.

Dr Asiama reaffirmed the Bank of Ghana’s commitment to ensuring that community banking remains a central pillar of financial inclusion and national development.

He said the reforms are intended not only to modernise the sector but also to preserve its founding purpose of making financial services accessible to ordinary Ghanaians wherever they live.

“As we celebrate 50 years of community-centred banking, we must ensure that the next generation of institutions remains resilient, innovative and capable of supporting inclusive economic growth,” he said.