The Gambia Financial System has evolved rapidly over the last
several years, and is markedly liberalised now. Most interest
rates are freely determined, direct controls have been eliminated,
exchange controls abolished and the country has moved to indirect
system of monetary controls using open market operations. These
measures increased competition in the domestic financial system.
As a result of developments and policy practices changes in the
legislation have also taken place. The Financial Institutions
Act (FIA), Central Bank Act (CBG Act) have been revised. The FIA
Act 2003 has been enacted while the CBG Act 1992 is almost in
its final stage of revision. The Insurance Act 2003 and the Money
Laundering Act 2003 have also been enacted.
The Central Bank of The Gambia is mandated under the provisions
of the Financial Institutions Act (FIA) 2003 and the Central Bank
Act (CBA) 2006 to license and regulate all financial institutions
in The Gambia. The Bank has an open policy towards Greenfield
investment in the financial sector
that would promote and enhance the country’s sound financial system.
The Gambia’s financial sector has been growing in numbers. It
consists of commercial banks, insurance
companies, foreign exchange bureaus, microfinance institutions
and other non-bank finance companies. However, commercial banks
dominate this industry controlling over 90%. Currently, there
are at least seven banks with an average foreign equity of over
60%. Six of the banks are involved in conventional banking and
one in Islamic banking. In terms of scope of activities the banks
operate mainly within the Greater Banjul area with some branches
and agencies located in other parts of the country. The remaining
parts of the country are mainly catered for by the micro-finance
There are eleven insurance companies in The Gambia and most of
them are involve in non-life underwriting. There is only one company
that is entirely a life underwriter and another that is a composite
The micro-finance sector consists of 66 institutions but classified
under several categories: Fiduciary Financial Institutions, Rural
Finance Bureaus, Community Finance Bureaus, Micro Savings and
Credit Bureaus and the Savings and Credit Associations. The micro-finance
sector has been identified by the Gambia Government as one of
the many instruments crucial in its drive to reduce poverty.
The financial sector in The Gambia, though competitive, has room
for new institutions and more so new products. With the global
trend moving towards universal banking and offshore banking, investments
in these areas can enhance The Gambia’s competitiveness internationally.
Although all the necessary legislations are not yet to be in place
to allow for offshore banking activities, efforts are underway
to address this.
In addition to the FIA Act and the CBA Act, potential investors
should acquaint themselves with other statutes such as the Insurance
Act and the Anti-Money laundering Act.