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Contents

Summary

Individuals and companies are free to transfer from Ghana up to US$50,000 without documentation; prior approval is required for money transfers from Ghana above this threshold. The Ghanaian government instituted additional restrictions in 2014 on foreign exchange in a bid to prop up the cedi (GHS) amid disappointing economic performance.

Ghana's money transfer regulations

The central bank, the Bank of Ghana (BoG), imposed a series of tough foreign exchange restrictions in February 2014 in an effort to slow the cedi’s decline. These included onerous documentation requirements for outgoing money transfers from Ghana, capital repatriation deadlines, and a US$10,000 limit on foreign currency purchases for travel abroad. The initial wave of restrictions also included a ban on loans denominated in foreign currency, and prevented Foreign Exchange Accounts (FEA) and Foreign Currency Accounts (FCA) holders from being issued chequebooks.

However, limiting access to foreign exchange proved to be a burden to local businesses. The BoG reported that the rate of depreciation began to slow in the first half of 2014; a number of these restrictions in June and August, although several remain.

As of August 2014, the BoG removed an earlier limit of US$1,000 on over-the-counter foreign exchange withdrawal. Individuals may still withdraw forex for the purposes of foreign travel up to a limit of US$10,000 per trip. The cedi is the sole legal tender in Ghana, although exporters of goods and services, such as hotels, are now permitted to receive payment in forex from non-residents.

The cedi is fully convertible to cover external payment obligations. Exporters are required to repatriate 100% of foreign-earned revenue through their FEAs, but the BoG removed the 60-day deadline; funds may be collected and transferred back to Ghana according to the timeline established in the trade agreement. FEAs may still be held in foreign currency.

In August, the central bank removed restrictions for individuals to make local payments from forex accounts and allowed them to be issued chequebooks. However, direct transfers between foreign currency accounts are still prohibited. In August, the BoG also reinstated domestic banks’ ability to issue foreign currency-denominated loans in compliance with risk management regulations.

The government limits the amount of hard currency that travellers can carry in or out of the country in one trip at a maximum of US$5,000.

Ghana’s regulatory authority

The country’s central bank, the Bank of Ghana (BoG), is responsible for setting monetary policy, monitoring the overall health of the financial system, and regulating financial service providers and payment systems. The bank also monitors the foreign exchange market, works to preserve the country’s foreign reserves and stabilise its currency.

Foreign Exchange Act of 2006 (Act 723) sets the limits for Ghana’s foreign exchange market. Notwithstanding occasional episodes of central bank intervention, the cedi floats freely, and is convertible into foreign currencies in most cases. Ghanaian law recognises two types of foreign currency accounts: Foreign Currency Accounts (FCA), can receive single-direction transfers such as personal remittances, local investment, or transfers to foreign embassies in Ghana. Foreign Exchange Accounts (FEA) receive foreign exchange generated from foreign business activity, including revenue from exports of goods or services.

Ghana’s economic background

The economy has historically been dependent on gold and cocoa, but major hydrocarbon finds in recent years have brought a surge in investment since 2010 that have the potential to transform the economy once exports ramp up and gas-driven domestic power generation improves. and attracted a unprecedented wave of foreign exchange and investment to the West African nation. The country has emerged as a regional destination for foreign investment, but overall economic growth has been restrained by mismanagement and fiscal profligacy, leading to the need for a new IMF programme.

The cedi has declined steadily in the last two years, largely as a result of high public spending levels and heavy trade deficits. The currency bounced on the announcement of discussions over a new IMF programme, but this is likely to do little more than slow the slide rather than reverse it.

Currency

Ghana’s monetary unit, the cedi (GHS), is generally indicated as GH₵ or ¢. One cedi is equivalent to 100 pesewas (Gp). The Bank of Ghana issues banknotes in values of ¢1, ¢2, ¢5, ¢10, ¢20 and ¢50. Coins are available in denominations of 1, 5, 10, 20 and 50 pesewas and ¢1.