TABLE OF CONTENTS

DECLARATION………………………………………………………………………………………………….. i

ACKNOWLEDGMENT………………………………………………………………………………………. ii

EXECUTIVE SUMMARY………………………………………………………………………………….. iii

CHAPTER 1: INTRODUCTION…………………………………………………………………………… 1

1. Purpose of the Project…………………………………………………………………………………… 1
   1. Scope of the Project……………………………………………………………………………………… 1
   1. Profile of BanqMoni Limited………………………………………………………………………… 1
   1. Rationale for Selecting BanqMoni Limited……………………………………………………… 3
   1. Internal Context Analysis……………………………………………………………………………… 4

Strengths………………………………………………………………………………………………………. 5

Weaknesses…………………………………………………………………………………………………… 6

Opportunities…………………………………………………………………………………………………. 6

Threats………………………………………………………………………………………………………….. 7

1. Overview of the External Environment…………………………………………………………… 9
   1. Political Factors……………………………………………………………………………………… 9
   1. Economic Factors…………………………………………………………………………………. 10
   1. Socio-cultural Factors……………………………………………………………………………. 11
   1. Technological Factors……………………………………………………………………………. 11
   1. Legal Factors……………………………………………………………………………………….. 12
   1. Ecological Factors………………………………………………………………………………… 13
   1. Ghana’s Financial Technology Industry………………………………………………………… 13
   1. Competitive Analysis………………………………………………………………………………….. 14
      1. The threat of New Entrants……………………………………………………………………. 15
      1. Bargaining Power of Suppliers……………………………………………………………….. 15
      1. Bargaining Power of Buyers………………………………………………………………….. 16
      1. The Threat from Substitute Products………………………………………………………. 16
      1. Rivalry among the existing players…………………………………………………………. 16

CHAPTER 2: NEEDS ASSESSMENT…………………………………………………………………. 18

• Chapter Overview………………………………………………………………………………………. 18
  • Needs Assessment……………………………………………………………………………………… 18
  • Methodology……………………………………………………………………………………………… 18
  • Problem Statement………………………………………………………………………………….. 20
  • Key Findings………………………………………………………………………………………….. 20

CHAPTER 3: MASTERY OF SUBJECT MATTER………………………………………………. 25

• Chapter Overview………………………………………………………………………………………. 25
  • Working Capital Management……………………………………………………………………… 25
  • Motives for Holding Cash…………………………………………………………………………… 25
  • Cash Management………………………………………………………………………………………. 27
  • The Optimal Level of Cash Balance……………………………………………………………… 27
  • Models of Cash Management………………………………………………………………………. 28
    • The Baumol Model:………………………………………………………………………………. 28
    • The Miller-Orr Model:…………………………………………………………………………… 29
  • Investment of Surplus Funds……………………………………………………………………….. 30
  • Investment Policy………………………………………………………………………………………. 32
  • Case Study………………………………………………………………………………………………… 33
  • Conclusion from Literature Review………………………………………………………………. 34

CHAPTER 4: SOLUTION AND IMPLEMENTATION PLAN……………………………… 35

4.0 Chapter Overview………………………………………………………………………………………. 35

• Solution and Tool……………………………………………………………………………………….. 37
  • Cash Management Framework using the Miller-Orr Model……………………….. 37
  • Investment Analysis Tool………………………………………………………………………. 39
  • Investment Policy for BanqMoni Limited……………………………………………….. 42
  • Implementation Plan…………………………………………………………………………………… 47
  • Resources Needed……………………………………………………………………………………… 48
  • Solution Analysis……………………………………………………………………………………….. 49

CHAPTER 5: RECOMMENDATIONS AND CONCLUSIONS……………………………. 50

• Chapter Overview………………………………………………………………………………………. 50
  • Recommendations………………………………………………………………………………………. 50
  • Project Limitation………………………………………………………………………………………. 51
  • Conclusion………………………………………………………………………………………………… 51

BIBLIOGRAPHY……………………………………………………………………………………………… 53

APPENDICES…………………………………………………………………………………………………… 59

List of Tables………………………………………………………………………………………………….. 59

List of Figures…………………………………………………………………………………………………. 61

CHAPTER 1: INTRODUCTION

1.0  Purpose of the Project

This applied research project seeks to develop a cash management and investment analysis framework for BanqMoni Limited. The tool will assist the firm in determining its optimal cash balance, as well as when and how much the firm must invest or redeem, to reach the optimal level.

An investment policy statement will also be documented for the firm. The policy will detail strategies for prudent investment of the firm’s surplus funds while maximizing the efficiency of the firm’s cash management activities. The policy is intended to be specific and meaningful for the firm, yet flexible for future use.

1.1  Scope of the Project

There are five sections in this report. The introductory chapter gives a profile of BanqMoni Ltd. and an evaluation of the company’s strengths, weaknesses, opportunities, and threats (SWOT). The chapter also explores the macroenvironment and microenvironment in which the firm operates. Chapter two looks at assessing the operations of BanqMoni Ltd to identify a business gap and propose solutions. To fill that gap, chapter three reviews existing literature to understand the problem identified and ascertain the viability of the proposed solutions. Chapter four primarily looks at the designed solution or tool, as well as the plan for implementation. The final section looks at limitations, conclusions, and recommendations drawn from the project.

1.2  Profile of BanqMoni Limited

BanqMoni is a financial technology (FinTech) service provider, fully registered under the laws of Ghana as a limited liability company. BanqMoni was launched in

August 2017. Its goal is to support banks in their efforts to build a thriving and cash-lite economy. The firm seeks to achieve this through its insurance-backed platform in partnership with GT Bank, which enables anyone to deposit money into any bank account within Ghana at any time by visiting any mobile money agent or from their mobile money wallet.

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