The Governor of the Bank of Ghana, Dr. Johnson Pandit Asiama, has urged banks operating in the country to prepare to lend to clients at rates below 10% in the coming weeks.
He explained that banks must diversify their portfolios by reducing overdependence on Treasury bills and the Central Bank’s lending instruments, and instead provide a stronger platform to support private sector-led economic growth.
Currently, Ghana’s average lending rate hovers around 27.4%, making it difficult for local businesses and institutions to access affordable capital.
In a related development, the Central Bank has reiterated its commitment to achieving a stable single-digit inflation rate over the next four years through robust policies and prudent fiscal management.
Speaking at the Monetary Policy Roundtable hosted by the Institute of Chartered Bankers in Accra, Dr. Asiama urged banks to increase credit to productive sectors, particularly the private sector.
“We need to move our banks into the post-stabilization phase quickly so that they can build bigger and stronger balance sheets, enabling them to cut lending rates from the current levels above 20%. This will give businesses access to cheaper capital to expand, driving massive economic growth for our country.
“In today’s fast-changing banking environment, banks must gradually move away from the comfort of government bonds and securities and innovate in supporting indigenous businesses in Ghana—a win-win for all,” he stated.
Dr. Asiama further stressed the need to fully back key sectors of the economy in line with the current downward trend in inflation.
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Story by Sika Togoh|univers.ug.edu.gh
