Making Sense of the Bank of Ghana’s New 5% Dollar Withdrawal Charge
I want to cut through the noise and explain what this is, why it’s happening, and what it means for you as customer of the banking sector.
In simple terms, what is the new rule? If you walk into a bank and withdraw US dollar cash without having deposited dollar cash first, a 5% fee will now apply. Think of it like this: the system now charges for net takers of physical dollar notes from the banking system.
If you deposited $10,000 in cash last week and come to withdraw $10,000 this week, no charge will apply. The fee is on the net outflow of physical cash.
Why has the Central Bank done this? This is not a revenue-generating measure for banks. It is a strategic move by the regulator to solve two critical problems:
- The Physical Dollar Drain:
There has been a significant and unsustainable drain of physical US dollar notes from the banking system. When everyone takes out cash, it creates an artificial scarcity, hurts liquidity, and ultimately weakens the entire financial system.
- Promoting a Modern Economy:
Ghana is moving towards a less-cash society. This policy actively encourages all of us to use safer, more efficient digital channels—wire transfers, manager’s cheques, and mobile money—for settlements. This is how modern economies function.
What does this mean for you?
- For Importers & Businesses:
You will need to review your treasury management. If you require physical dollars to pay for certain services, you may need to factor in this cost. The smarter approach is to shift your suppliers to electronic payments.
- For Travelers:
If you need dollars for travel, you may face this charge if you are converting from cedis directly to cash. Planning ahead and exploring digital travel cards or other electronic options will be more cost-effective.
- For Everyone:
The key takeaway is this: The era of using the banking system as a free revolving door for physical dollar cash is over. The system is incentivizing you to keep your foreign currency in digital form within the bank and to use electronic methods for transactions.
This policy is here to stay. It is a necessary step to stabilize the foreign exchange market and ensure the system has adequate liquidity for critical needs.
The banking sector has a suite of efficient digital FX transfer products that can help you conduct your business without incurring this new fee. This hopefully will be a step towards a stronger, more stable financial system.
