- DDG SEC Says Higher Levies Will Fund Stronger Market Oversight as Operators Question Costs
Ghana’s Securities and Exchange Commission has mounted a robust defence of its new levy regime, arguing that higher contributions from licensed market operators are necessary to finance the personnel, technology and institutional capacity required to supervise an increasingly sophisticated capital market, even as industry participants warn that some of those costs could ultimately be passed on to investors.
Mr Mensah Thompson, Deputy Director-General of the SEC Ghana, said the increases should not be viewed simply as additional operating costs imposed on financial institutions, but as part of the price of building a stronger regulatory system capable of protecting investors and supporting long-term market development.
Speaking during a special edition of the NorvanReports Economic Governance Platform on X Space on Sunday, August 16, 2026, he acknowledged that the measures had generated considerable concern across the industry.
“We know that these measures are tough. We know that it has ruffled you a bit. But this is the time where we all put our hands together and lift this market up,” Mr Thompson said.
The discussion, hosted by Norvan Acquah-Hayford, Managing Editor of NorvanReports, was held under the theme, “Regulating or Overcharging? Examining SEC’s New Levies and the Future of Ghana’s Capital Market,” with particular attention on the question of who eventually absorbs the economic burden market operators, fund managers or the Ghanaian investor.
The debate exposes a difficult regulatory trade-off: a capital market cannot develop sustainably without effective supervision, but regulation itself can become a barrier when the cost of compliance rises too sharply.
Much of the controversy has centred on percentage increases that run into several hundred per cent for some categories of charges, prompting concerns that smaller operators could face disproportionate pressure on margins.
The SEC, however, argues that focusing exclusively on the percentage increase can distort the actual economic impact because some of the charges are rising from relatively low nominal amounts.
Mr Thompson pointed to an annual market levy increasing from GH¢5,000 to GH¢25,000, mathematically equivalent to a 400% increase, but questioned whether the new amount was excessive for institutions managing portfolios running into hundreds of millions of cedis.
“You are managing, some of you are managing portfolios in the sense of hundreds of millions of cedis. And you pay GH¢5,000 as market levy. And if that GH¢5,000 is taken to GH¢25,000, that is a problem? You guys should be fair to us,” he said.
The argument has considerable economic merit for larger operators because a GH¢20,000 increase may represent a relatively small proportion of operating income where an institution manages substantial assets. The difficulty is that Ghana’s investment industry is not composed exclusively of large fund managers, meaning the same fixed charge can have materially different effects depending on the size, profitability and client base of the institution being regulated.
That raises the question of proportionality. If higher fixed regulatory costs weigh more heavily on smaller operators, they could unintentionally create an additional barrier to entry or encourage consolidation around larger institutions, potentially reducing competition in a market where greater product diversity and participation remain important development objectives.
The SEC’s strongest defence, however, lies in the resources required to supervise the industry effectively. Mr Thompson disclosed that fewer than 10 personnel within the Commission’s asset management department are responsible for supervising more than 85 asset management companies, collective investment schemes and mutual funds, illustrating the strain placed on regulatory capacity as the market expands.
That workload increasingly involves more than processing licences and reviewing routine reports. Securities regulators are expected to monitor liquidity and investment risks, disclosures, fund-management practices, investor complaints, cyber threats, market misconduct and increasingly complex financial products while also maintaining the technical capacity required to respond to innovation across the industry.
Ghana’s own financial-sector experience makes the cost of regulatory weakness particularly difficult to dismiss. Poor supervision can allow problems to accumulate until investors face losses, institutions fail and government is forced to intervene at a cost potentially far greater than what would have been required to maintain effective oversight in the first place.
The SEC says increased revenue will therefore support recruitment, specialised training, staff retention, regulatory technology and stronger operational infrastructure. Mr Thompson also referred to the Commission’s physical infrastructure requirements, including plans for a new head office, an element of the funding argument that is likely to attract closer scrutiny from operators concerned about how the additional levy proceeds will be spent.
That places an important responsibility on the regulator to demonstrate value for money. Market participants may be more willing to accept higher charges if they translate visibly into faster product approvals, more effective surveillance, better digital services, stronger enforcement, quicker resolution of investor complaints and more consistent supervision across the industry.
The harder question remains who ultimately pays because regulatory charges imposed legally on fund managers and brokers do not necessarily remain on their balance sheets. Institutions can absorb additional costs through lower profit margins, but they can also seek to recover them through management fees, transaction charges or other costs imposed on clients, meaning the investor may eventually bear part of the burden.
That risk becomes particularly sensitive at a time when Ghana is seeking to broaden participation in formal investment products and mobilise more domestic savings into productive capital. Higher recurring costs can reduce net investment returns and make capital-market products less attractive, particularly to smaller retail investors who may already be reluctant to move savings away from traditional bank products.
The counterargument is that investors also pay heavily when regulation fails. If additional resources enable the SEC to detect misconduct earlier, strengthen market surveillance and reduce the probability of institutional failures, the long-term benefit to investors could exceed the additional costs generated by the levy regime.
The Commission’s challenge is therefore to demonstrate that this is the bargain being offered. Greater transparency over levy proceeds, accompanied by measurable indicators covering supervisory coverage, approval timelines, enforcement outcomes, digitalisation and investor-protection performance, could allow the industry to judge whether higher regulatory charges are delivering commensurate improvements.
A properly resourced securities regulator can become an economic asset by strengthening confidence, improving market integrity and making the financial system more attractive to institutional and long-term capital. But excessive regulatory costs can produce the opposite result by weakening smaller firms, discouraging new entrants and eventually increasing the cost of investing.
Mr Thompson’s case is that Ghana cannot aspire to build a larger and more sophisticated capital market while financing its regulator as though the industry had not evolved. The market’s response is likely to depend increasingly on whether the SEC can prove that every additional cedi collected is helping to produce a safer, more efficient and more trusted investment environment.
The debate may therefore ultimately move beyond whether a particular levy increased by 100%, 200% or 400%. If operators are being asked to pay substantially more, the decisive question will be whether Ghana’s capital market receives substantially stronger regulation in return.
