Accra: Rural and community banks (RCBs) in Ghana have been advised to support their transition to community banks with substantial operational reforms, as the Bank of Ghana's (BoG) microfinance directive sets a deadline of December 31 for full compliance. This shift, although welcomed for removing the 'rural' label, presents a challenge that goes beyond mere rebranding, demanding a transformation in the banks' operational approach.
According to Ghana Web, the reform is anticipated to enhance banks' lending to small businesses, boost local economic development, and improve service delivery. This move marks a shift from the traditional reliance on government securities toward more impactful and community-focused banking. Initially set for March 31, the deadline for this transition has been extended to December 31, as confirmed by sources within the rural banking industry.
Rural banking expert and Executive Director of Proven Trusted Solutions, Mr. Joseph Akossey, has expressed support for the reform, highlighting that industry players have long advocated for the removal of the 'rural' tag. He stated that the 'rural' label negatively affects brand equity, identity, and overall appeal. Mr. Akossey emphasized the necessity for RCBs to align their operations with their new status as community banks, ensuring that their practices meet or exceed customer expectations.
Mr. Akossey underscored the importance of increasing lending to support local businesses, which is crucial given that deposits are collected from the communities where the banks operate. He suggested revisiting the traditional business model, which heavily invests in government securities, and highlighted the international experience where community banks in the United States provide significant support to small businesses and agriculture.
Citing examples within Ghana, Mr. Akossey mentioned Amenfiman Rural Bank, now a community bank, which has been supporting local enterprises with a loan portfolio reaching about GHS1 billion as of December 2025. Nyakrom Community Bank PLC has also been commended for its focus on business lending, with a loan-to-deposit ratio exceeding 60 percent.
In an interview with BandFT, Mr. Akossey urged community banks to play a proactive role in identifying viable business opportunities within their regions and supporting capable entrepreneurs. By doing so, banks can help unlock local economic potential and create employment opportunities, especially for the youth, while offering an alternative to investing in government instruments.
He also stressed the need for RCBs to engage in corporate social responsibility (CSR) initiatives, particularly in education, health, and social projects, as the new model promotes community ownership, with communities expected to hold up to 30 percent equity in the banks.
Mr. Akossey advocated for a shift towards relationship banking, emphasizing the importance of building long-term ties with customers. He noted that improving service quality is essential for customers to perceive real change following the transition, with staff requiring training to meet the higher standards of community banking.
Finally, he called for digital transformation in bank operations, urging banks to move away from outdated systems like passbooks and adopt hybrid service models combining digital solutions with personalized service. Mr. Akossey also highlighted the importance of effective brand communication strategies to reposition community banks and attract younger demographics and professionals.