The practice of keeping significant amounts of cash on hand at home has an impact on how the money supply aggregate in Ghana is calculated, according to a banking consultant Mr. Richmond Attuahene.

0

“In Ghana, we have M1 and M2 which is all about the aggregation of money so far in the economy.

1

“If somebody is holding such a quantum of money, it means all the figures we have been churning out in the M1 supply and M2 supply are not complete, so it makes it very difficult,” he made this statement during a media engagement on Wednesday, July 26, while discussing the situation where some foreign cash was found in the bedroom of former Minister of Sanitation and Water Resources, Cecilia Abena Dapaah.

2

According to reports, Madam Cecilia Dapaah stored millions of unreported Ghana Cedis, $300,000, and $1 million at home.

3

Furthermore, according to Mr. Attahene, the practice deprives banks of cash they could use to make loans to the private sector for economic development.

4

He claimed that this approach has an impact on the monetary policy's effectiveness.

5

“It also deprives the banks. when we take deposits, we then churn them into investments and be lending to the private sector so we move the money from the surplus area to the deficit area to support the private sector in the growth of the economy.

6

“So seriously, somebody hiding this money, it means that the economy is being deprived of money to be used in loanable funds to the private sector,” he said.

7

The governor of the Bank of Ghana (BoG), Dr. Ernest Addison, previously stated that the central bank was concerned about the tendency of people keeping significant amounts of foreign currency, particularly dollars, in their houses.

8

At the 113th Monetary Policy Committee (MPC) press conference in Accra on Monday, July 24, when asked if the BoG was concerned about Cecilia Dapaah's situation, Dr. Addison responded, "It is a worry to all of us but it is matter in court so there is not much to say about it."

9

10