Gov´t sets timeframe to close own accounts with commercial banks.

Consequently, the government has embarked on a gradual withdrawal of all monies being held in commercial banks into the single treasury account.

According to media reports, the Ministry of Finance is poised to transfer some 165.6 billion FCFA it presently saves in commercial banks and microfinance institutions to the Single Treasury Account, STA; or (Cont Unique du Tresor), CUT.

The move is in respect of a provision in the current Finance Law, which stipulates that government money lodged in the lower banking institutions be transferred to the STA by December 31, 2025.

Code named public resources repatriation plan, officials say, it will be implemented under the guidance and supervision of the Bank of Central Africa States, BEAC.

A move that was reiterated by Achille Bassahag, the Director of Public Accounting in the Ministry of Finance, according to media reports. 

“The accounts of government agencies opened in the books of commercial banks and microfinance institutions will be closed by December 31, 2025, based on a timetable established with the banking sector," Bassahag. 

The MINFI official had added that the money in those accounts will therefore be transferred to a single account opened in the books of the central bank, BEAC. 

The law does specify that a regulatory document will outline the closing procedures and timetable but the specific details of the document are currently unavailable.

As of December 31, 2022, over 1.3 trillion FCFA of public deposits were held in credit institutions, out of a total outstanding balance of seven trillion FCFA. 

This means that by the end of 2025, when the overall repatriation plan is completed, the cash position of banks with high exposure to the government could be affected, limiting their ability to finance the economy.

However, Finance Minister, Louis Paul Motaze, reassured the banking sector, during a ceremony to present the 2022 public securities issuance programme to local banks, that “things will be done smoothly” to avoid any inconvenience in the sector.

Why the move

Officials say the STA account will reduce delays normally experienced when government wants to settle bills due services providers and other creditors. 

The STA account will also up transparency in the management of public funds, as many existing bottlenecks are now avoided.

“The CUT is a unified structure of government bank accounts that provides an overview of its liquidity. Based on the principle of the cash unit, it consists of a bank account or a series of linked accounts from which the government makes all of its receipts and disbursements,” Motaze is quoted as having stated.

While observers say Cameroon is still facing unusual public payment delays far beyond the 90 days maximum prescribed by the Economic and Monetary Community of Central African States, CEMAC.