BoG urges Ghanaians to embrace coins to curb inflation
The Bank of Ghana (BoG) has advised Ghanaians to embrace the use of coins in their daily transactions to help control the pricing of goods in the country.
It explained that the widespread aversion to coins leads vendors to round off prices, negatively impacting the central bank's inflation objectives and eventually affecting price control in the market.
Addressing the media at the opening of the regional workshop on currency management and forecasting in Accra on July 14, the Director at the Currency Department of the BoG, Dominic Owusu, stated that coins stayed in circulation longer, reducing the need for frequent replacements and saving the nation significant costs associated with printing new banknotes.
“The coins are necessary to stabilise prices because in their absence people will round off prices of goods, which will impact on inflation. The coins stay in circulation longer and help us as a nation save on printing notes,” he said.
The regional workshop, being held between July 14 and 18, is being held by the West African Institute for Financial and Economic Management (WAIFEM) to enhance the capacity of central banks in West Africa.
It is expected to focus on recent developments in currency management, including digital currencies, to deepen participants' knowledge and analytical skills in this area.
The workshop will also cover topics such as the currency lifecycle, the currency management value chain, and contemporary issues in banknote and currency management.
Currency management
Mr Owusu explained that effective currency management was crucial for central banks, as cash remained a trusted and widely used means of transaction, particularly in formal sectors, despite the growing trend towards digital payments.
He said the central bank continued to prioritise innovation in currency management by automating cash centres, reviewing and updating outdated currency laws, and strengthening policies to handle soiled or damaged currency notes, while raising public awareness about the importance and value of the national currency.
He said the currency played a vital role not only as a medium of exchange but also as a symbol of national pride and economic stability, reflecting the country's identity and financial health.
He said as stewards of the national currency, all stakeholders needed to collaborate and adopt forward-thinking strategies that promote operational excellence and a secure, efficient financial environment for the future.
“This workshop provides a rich opportunity to learn from one another, share institutional-based practices, and return home with refreshed ideas and stronger regional economies,” Mr Owusu, who represented the Governor, added.
The Director at the Research and Macroeconomic Management Department of WAIFEM, Dr Christian Ahortor, stated that currency management and forecasting were a critical function in central banks' operations.
He explained that the integrity of a currency and its efficient supply were clear indicators of a well-functioning central bank.
He said central banks must operate with effectiveness and efficiency in managing currency, given its critical role and sensitivity, to avoid any issues that could tarnish the reputation of a country's financial system.
He said of particular concern was the issue of counterfeiting, which was as old as money itself, continued to pose a significant threat to financial systems.
“Generally, effort towards protecting currencies from counterfeiters has increasingly become more dependent on cooperation or collaboration among law enforcement agencies, financial institutions and central banks, the security printing industry and the high-grade suppliers' community.
“Cooperation or collaboration bridges geographic, jurisdictional, cultural and organisational divisions, which were once impediments to providing comprehensive and co-coordinated solutions for combating modern financial crimes,” he said.