Guinea’s Financial System: A Review
Overview of the West African Monetary Zone (WAMZ)
Guinea is a member of the West African Monetary Zone (WAMZ), a regional monetary initiative that comprises six countries: Gambia, Ghana, Liberia, Nigeria, Sierra Leone, and Guinea.
Characteristics of the Guinean Financial System
The Guinean financial system is characterized as shallow and informal, with total financial sector assets representing only 22% of GDP. This indicates a limited capacity for economic transactions and investment.
Access to Banking Services
Only 8% of the population had access to a bank or non-bank deposit-taking institution account as of 2017. This highlights a significant gap in financial inclusion, limiting the ability of individuals and businesses to participate in the economy.
Mobile Financial Services: A Key Driver of Financial Inclusion
The introduction of mobile financial services has improved financial inclusion, with approximately 13.8% of the population having access to a mobile wallet and associated payment services as of 2017.
Dominance of the Banking Sector
The banking sector dominates the Guinean financial system, representing 94.6% of total financial sector assets. This indicates a high level of concentration in the sector, with few players controlling a large share of the market.
Absence of a Stock Market
There is no stock market in Guinea, limiting the ability of individuals and businesses to raise capital through equity markets.
Foreign Ownership in the Banking Sector
All commercial banks in Guinea are subsidiaries of foreign groups, with the top three banks representing approximately 57.4% of total banking sector assets. This highlights a high level of dependence on foreign ownership in the sector.
Key Statistics
- Total financial sector assets: 22% of GDP
- Number of commercial banks: 16
- Number of non-bank deposit-taking institutions: 21
- Number of insurance companies: 12
- Percentage of population with access to a bank or non-bank deposit-taking institution account: 8% (2017)
- Percentage of population with access to a mobile wallet and associated payment services: 13.8% (2017)