Mr. Hackman Owusu-Agyemang, Member of Parliament (MP) for New Juaben North, on Wednesday appealed to the government to establish a Financial Services Authority (FSA) and the Office of Financial Ombudsman.
This he said would prevent the short changing of Ghanaian businesses by the banks and other financial institutions.
The phenomenon has made people to have the conviction that there is a form of cartel operation at play; Mr. Owusu-Agyemang said this in a statement he presented at the floor of Parliament.
He said his statement stemmed from President John Evans Atta Mills State of the Nation address last year, during which he appealed to the membership of the House to join in managing the economy “in this difficult times”.
The FSA according to him would promote efficient, orderly and fair financial market and help retail financial services for consumers to get a fair deal.
“It will set the standard that must be met and can take action against firms if they fail to meet the required standard,” Mr Owusu-Agyemang said.
He stated that the FSA should be obliged to enforce the principle of good regulatory mechanism.
Mr. Owusu-Agyeman noted that FSA are normally set by an Act of Parliament to ultimately derive its powers from the House and accountable to the public, industry, Executive and Legislature.
He said in some democratic countries, funding was from industry and the firms being regulated.
The MP said the Financial Ombudsman must also be set by an Act of Parliament and be independent to provide service to the public.
“The Ombudsman’s main task is to settle individual complaints between consumers and businesses, providing financial services from insurance mortgages to investments and credits, including pension loans and hire purchase stocks, shares, unit trusts and bonds money transfers.” Mr. Owusu-Agyemang added.
He stressed that Financial Ombudsman is independent and impartial, though its findings cannot prevent one from going to court. However in most instances the parties accept its adjudication.
He said under this system disputes could informally be settled but if decisions under it were accepted it would be binding on both parties and the businesses concerned.
Mr. Owusu-Agyemang said the Bank of Ghana lacked the authority and the capacity to champion the cause of the ordinary Ghanaian businessman.
He said what was needed was to re-look the banking sector and put regulatory measures that would enforce equity and fairness and mechanisms for grievances.
Mr Owusu-Agyemang observed that every year a number of banks make more than 40 per cent net profit and questioned how many Ghanaian businesses were breaking even let alone making 10 per cent returns.
“If the cost of doing business continues to soar, unemployment would result as most business would be in distress and inflation would spiral out of control.”
Lets us create a FSA and Financial Ombudsman to work jointly to ensure an effective control of the Financial Service Organisation and make sure that actions or inactions of Financial Services can be referred to for resolution, he said.
Contributing to the debate, Dr. Anthony Akoto Osei, MP for Old Tafo said financial consumers in Ghana were being cheated because the state in which bonds were raised was not clear.
He cited the example of a 15 year bond meant for the Black Satellites who won the Under 20 World Cup in Egypt in 2009 and wondered how much would be realised by each of the young footballers.
He said the establishment of the FSA and the Financial Ombudsman would go a long way in solving the financial problems suffered by consumers.
Mr. Haruna Iddrisu, Member for Tamale South, said Ghana had a liberalised banking system which attracted so much competition.
He said the Minister of Finance to this effect would consider a bill with regards to the FSA and the Financial Ombudsman.