ba es o f gh a na nk t. 1 9 5 7 euromoney ghana / west african conference building a digital business and financial ecosystem opening keynote address by dr. ernest addison governor, bank of ghana kempinski hotel, accra september 25, 2018 ba es o f gh a na nk t. 1 9 5 7 your excellency, vice president of the republic of ghana – alhaji dr. mahamudu bawumia, deputy governors of the bank of ghana, honourable ministers of state and members of parliament, the senior external adviser, euromoney conference, representatives of mastercard foundation, stakeholders in the digital finance sector, distinguished guests, ladies and gentlemen, all protocols observed. 1. good morning and it is a pleasure to participate in this euromoney ghana / west africa conference on building a digital business and financial ecosystem. before proceeding, let me thank euromoney for choosing accra as the host city for this conference and also for providing such a unique platform for industry experts, regulators, and policymakers to deliberate on digitization of business and the financial ecosystem. i believe these deliberations would facilitate and enhance the pursuit of financial inclusion by countries across the west african sub - region. 2. ladies and gentlemen, a decade ago the importance and criticality of payment systems was only heard and understood exclusively within banking circles. payment ba es o f gh a na nk t. 1 9 5 7 services were entirely a space dominated by banks. customers of banks wrote cheques that were issued by banks and deposited into accounts held by banks. banks settled payments among themselves through a clearing arrangement. overtime images of cheques facilitated clearing ; even as electronic payment developed, debit and credit cards were initially issued by banks. today, this has changed considerably and the payment systems space has grown to include telecommunication many non - bank companies and actors, financial including technology firms. financial digitization has unleashed a wave of financial products and services at minimum cost to meet current business demands for financial services. digitisation brings many benefits and can help scale up access to financial services through mobile phones, pos and access points through an agent network. 3. the consumer - experience with financial services is rapidly transforming on several fronts. for instance, across west africa, consumer interfaces are gradually moving online and physical notes and coins are being replaced by electronic forms of payment. ba es o f gh a na nk t. 1 9 5 7 4. ladies and gentlemen, this

the main responsibility for managing the liquidity and other exposures of these institutions lies with the institutions themselves, within an appropriate regulatory and supervisory structure. 19 but as we have learnt somewhat painfully over recent decades in a variety of jurisdictions, occasions can arise where the systemic nature of liquidity risks make it difficult, if not impossible, for individual institutions to attain the resilience and robustness they need. central banks have therefore begun to discuss the need for additional backstops. in particular, they have considered whether the need for asset purchases to address dysfunction in the markets where nbfis operate has risen relative to the need to provide liquidity to standard banking counterparts for central banks. since asset purchases implemented in this context work in concert with changes in bank rate, they naturally take place when those interest rate changes are taking place. 20 in other words, such asset purchases would naturally happen when bank rate is away from its effective lower bound, and retains the flexibility to move in both directions. moreover, to the extent that the support offered by asset purchases represents the offer of the central bank ’ s balance sheet as an alternative venue for intermediation when private markets have seized up, it is natural that the asset purchases could be accompanied by asset sales, either in parallel or at least in close proximity. it is by both buying and selling ( or alternatively lending and borrowing ) that the central bank intermediate financial transactions between private market participants. this is the essence of the central bank acting as a central counterparty or market maker of last resort. bank of england relationship with financial stability there is also a natural complementarity between providing central bank support to maintain market functioning and contributing to the maintenance of financial stability. indeed, the two go hand ‐ in ‐ hand. the direction of support will depend upon the specific incidence of market failure causing market dysfunction, the structure of the financial system, and the broader flexibility of the economy. this is the essence of why such interventions will be ‘ targeted ’ on specific market segments. these factors will vary both over time and from one jurisdiction to another. the form of support offered by central banks will thus also vary. yet central banks must also recognize the limitations of their policy. in the face of crisis, they may need to be innovative in their approach. but central banks should be very wary of assuming responsibility for goals that they do not have the instruments to pursue. re - establishing market functioning ultimately relies on the behaviour of market participants. the central bank can support this process, but in