Governor of the Bank of Ghana Dr Johnson Pandit Asiama has urged commercial banks to increase their investments in agriculture
During a meeting with the heads of the banks in Accra on Wednesday, Dr Asiama said that inflation has declined significantly, the exchange rate has remained relatively stable, financial conditions have eased considerably, and interest margins have become increasingly compressed.
Against this backdrop, he said they are beginning to see a strong rebound in credit creation. However, despite the improved economic environment and the growing demand for credit, many small and medium-scale enterprises (SMEs), particularly those in the agricultural value chain, still struggle to access finance because banks continue to perceive these businesses as relatively high-risk.
“As banks, you are not merely financial intermediaries; you are important business partners in the growth and transformation of the economy,” he said.
“I therefore encourage you to deepen your understanding of the businesses and sectors you serve, particularly the unique dynamics of agriculture and its associated value chains,” he said.
This should include developing innovative and flexible credit products that recognise the seasonal nature of agricultural activities and align loan repayment schedules with the timing and pattern of borrowers’ cash flows.
Dr Asiama said such an approach would enable SMEs to access financing on terms that better reflect the realities of their businesses, support banks to manage risk more effectively, while ensuring that the benefits of the improved macroeconomic environment translate into broader economic activity and job creation.
