Ghana’s financial intermediaries to receive $250m World Bank support

The country is set to receive a total of $250 million to advance the Ghana Development Finance Project, the World Bank Group has revealed.

This will involve wholesale financing to financial intermediaries such as savings and loans companies to on lend to Micro, Small and Medium Enterprises (MSME).

It is, therefore, working with the Finance Ministry in consultations with the Central Bank of Ghana to conclude preparations for the project which awaits approval before September. World Bank Country Director for Ghana, Pierre Frank Laporte, says the project will also provide Credit guarantees to encourage financial institutions to lend to SMEs and other borrowers who lack collateral.

This was revealed at the 10th Annual General Meeting of the Ghana Association of Savings and Loans Companies (GHASALC) held virtually. Ghana’s financial sector for the past years has gone through some amount of clean up meant to stabilise and strengthen the sector for the better.

Financial intermediaries have been the hardest hit, like many of them it has resulted in the revocation of the licenses of 15 members of GHASALC for instance. COVID-19 is compelling many businesses especially the financial institutions to change it way of doing business.

In the face of the pandemic, Micro, Small and Macro Enterprises (MSME) and other clients of the savings and loans companies are consistently asking for loans to be restructured or rescheduled.

Officials say this has brought more strain on the resources of the member companies because businesses of clients are not doing well.

Executive Secretary for GHASALC, Tweneboah Kodua Boakye observes Covid-19 has really confirmed that majority of the public depend on the Savings and Loans Companies for survival and business growth. Board Chairman, Kwaku Duah Berchie, encouraged its members to embrace what has become the “new normal” and innovate.

He added that risk management should also be enhanced while they continue to build the capacities of the directors and employees.


Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *