Bank of Ghana and Industry Stakeholders Strategize to Unlock SME Credit and De-risk Lending Environment

The Bank of Ghana (BoG) and the Ghana Association of Banks (GAB) are intensifying efforts to improve credit access for small and medium-sized enterprises (SMEs) by addressing structural risks and underutilized collateral systems. During a series of sensitization programs, Alexander Koomson, Assistant Director of the BoG Collateral Registry, urged businesses to leverage the Borrowers and Lenders Act, 2020 (Act 1052). He emphasized that many SMEs remain unaware of their ability to use movable assets, such as equipment and inventory, as collateral to negotiate better lending terms. While the central bank aims to facilitate easier financing, it has also issued a stern warning to financial institutions against using unlawful force or harassment in debt recovery, mandating strict adherence to statutory procedures.

Despite these efforts to streamline credit, data from 2025 reveals a shifting landscape in the financial sector. Total credit enquiries reached over 25 million, representing a 12.12% decrease from the previous year, primarily due to a reduction in traditional loan enquiries. However, commercial banks maintained their dominance in the credit referencing system, accounting for 86.28% of all enquiries. This activity was largely driven by a surge in mobile money loans and payroll lending, which have become critical pillars of the credit market. John Awuah, CEO of the Ghana Association of Banks, noted that while banks are responding to improved monetary policy conditions—including a strategic policy rate of 14%—private sector credit growth grew by 29% year-on-year.

However, industry leaders argue that sustainable lending requires more than just available capital. John Awuah highlighted that Ghana’s non-performing loan (NPL) ratio remains high at approximately 15.8%, a figure he identified as a significant barrier to affordable credit. He stressed the need to "de-risk" the SME environment by improving storage, distribution, and market access, particularly in the agricultural sector. Supporting this view, William Agyei-Manu, Chairman of the Agribusiness Sector of the Association of Ghana Industries (AGI), called for more flexible loan repayment structures and grace periods that align with the operational realities of different industries to prevent further rises in NPLs.

To complement these financial reforms, private sector players are moving to bridge the digital and capacity gaps within the SME sector. MTN Business has launched initiatives like Yello Biz and Adwuma Pa to help small businesses, particularly those led by women, establish an online presence and improve financial literacy. These training programs are set to be decentralized across all 16 regions to enhance global competitiveness. Collectively, these initiatives from regulators, banks, and telecommunications leaders signal a coordinated push to strengthen Ghana’s credit architecture and ensure that SMEs can serve as the primary engine of national economic growth.