BoG Governor urges savings and loans firms to focus on MSMEs

Governor of the Bank of Ghana (BoG), Dr. Ernest Addison, has urged savings and loans (S&L) companies to refocus on supporting micro, small, and medium enterprises (MSMEs) instead of pursuing large-scale projects suited for commercial banks.

He cautioned that such shifts expose S&L firms to high-risk transactions without adequate risk management, resulting in non-performing loans (NPLs)

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Speaking at the 14th Annual General Meeting of the Ghana Association of Savings and Loans Companies (GHASALC) in Accra, Dr. Addison highlighted the importance of S&L companies contributing to financial inclusion by targeting low-income entrepreneurs, youth, and women-led ventures. He recommended adopting group lending methodologies inspired by Grameen and village banking models.

Dr. Addison emphasized the need for S&L firms to leverage technology and FinTech partnerships to reach underserved customers and improve financial literacy. He stressed the importance of public financial education to address challenges like solvency, liquidity, and weak governance, urging the sector to prioritize operational efficiency and enhance credit assessment processes.