Ghana prepares for new, simplified currency

On 1 July, the country will introduce the Ghana cedi (GHc) which will shave off a significant number of zeros from the current denomination in an effort to make financial transactions simpler.

The GHc will set 10,000 cedis to one Ghana cedi.

"New notes and coins will be issued to replace the existing notes and coins over a period of at least six months," the nation's central bank said.

Ghana hopes the new denominations will reduce the transaction costs of the current system, which requires those dealing with the local currency to contend with thick wads of banknotes to pay for a relatively small amount of goods or minor services.

For example a plate of food and a half litre soft drink at a local fast food restaurant costs around 75,000 cedi. This presents some difficulties as cedi banknotes begin at 1,000 in value and go up to 20,000.

Tourists going about their shopping around the city can expect to pay drivers about 100,000 cedi per hour, roughly R100.

Thus day to day banking and paying for services and goods requires a thick wallet and a lot of patience.

One new GHc will be equal to 100 Ghana pesewas (or cents).

The Bank of Ghana further explains that the new system will reduce the risk and inconvenience of carrying large sums of the currency; reduce problems with accountancy and data processing software and minimise the strain on ATMs regarding the huge amount of notes required for withdrawals.

Solomon Alhassan, a private investment broker in Accra's wealthy West Ridge financial district told BuaNews on Tuesday that the major banks have been educating both professionals in the finance sector and the public on the new system.

"Banks such as Barclays, UBA, Ghana Commercial Bank and Stanbic Bank [the Ghanaian arm of South Africa's Standard Bank] have been giving presentations to financiers and conducting roadshows for the general public, particularly in rural areas and to informal traders in markets," Alhassan said.

Some members of the public were fearful of the change and would take some time to grow accustomed to it, he explained.

Even before 1 July, the country's public servants would have received their salaries for the end of June in GHc and Ghana pesewas, thus speeding up the introduction and assimilation of the new money into the economy.

Old and new notes will be in circulation at the same time, for around six months and the central bank has advised business owners to display prices in both the old and new systems.

Businesses appear to be embracing this as a visit to local cellphone service provider Areeba's offices in Osu revealed.

The company displayed both the old and new system's prices for their services and packages and consultants were more than happy to hand out pamphlets and explain how this will impact on their customers.

Hotels, restaurants and even petrol filling stations across the very busy Accra city centre are also complying ahead of schedule by displaying both formats, with some even going as far as displaying currency conversion charts supplied by the Bank of Ghana.

Article published courtesy of BuaNews