Bank of Ghana Bans Payment Service Providers from Holding Merchant Funds in Major Regulatory Overhaul

Introduction

The Bank of Ghana (BoG) has introduced a sweeping regulatory change affecting the financial technology sector, prohibiting Payment Service Providers (PSPs) from holding merchant funds. The new directive is designed to fortify consumer protection, enhance transparency, and mitigate systemic risks within Ghana’s rapidly expanding digital payments ecosystem.

Regulatory Shift in Digital Finance

Under the updated framework, PSPs must partner with licensed universal banks to manage merchant settlements, ensuring that merchant capital is segregated and protected under traditional banking regulations. Industry analysts view the move as a crucial step toward stabilizing digital transactions and safeguarding stakeholder interests as the country navigates broader financial sector reforms.

Key Takeaways

• Bank of Ghana bars Payment Service Providers from directly holding merchant funds.
• New policy mandates collaboration with licensed universal banks for merchant settlements.
• Reform aims to strengthen security, transparency, and consumer trust in digital financial services.
• Move comes alongside broader regulatory updates aimed at sanitizing Ghana’s financial landscape.