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Banking consultant Dr. Richmond Atuahene has raised serious concerns over a proposal suggesting that a portion of the Bank of Ghana’s Cash Reserve Ratio (CRR) be allocated to support local cocoa purchasing companies.
The suggestion came from Dr. Randy Abbey, CEO of COCOBOD, who advocated for 2 to 3 percent of the reserve funds to be redirected to help sustain Ghanaian-owned businesses in the cocoa industry.
In an interview with Citi Business News, Dr. Atuahene argued that such a move would be inappropriate, warning that the CRR is a key monetary policy tool intended solely for managing banking sector liquidity—not for financing private ventures.
“These are funds held by the Central Bank, drawn from commercial banks, and they serve to maintain liquidity within the financial system,” he explained. “Channeling these reserves into cocoa purchases would diminish the liquidity buffer available to banks, which could have wider implications for the economy.”
He further emphasized that the Bank of Ghana does not provide interest on these reserves, labeling them as “unremunerated.”
“To be clear, when commercial banks are mandated to hold a portion of their deposits as reserves, they do not receive any return on those funds,” Dr. Atuahene said. “Are we now suggesting that money banks already earn nothing on should be redirected to fund cocoa buying? I strongly oppose this idea.”
He cautioned that diverting statutory reserves for commercial use could erode confidence in monetary policy and potentially destabilize the financial sector.
According to Dr. Atuahene, preserving the integrity of monetary tools like the CRR is essential to ensuring macroeconomic stability and a healthy banking environment.
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