BoG Pushes for Stronger Credit Culture as Reforms Drive Surge in Registered Borrowers
The Second Deputy Governor of the Bank of Ghana (BoG), Mrs. Matilda Asante-Asiedu, has underscored the central bank’s renewed focus on strengthening Ghana’s credit ecosystem, highlighting significant gains from ongoing reforms under the Borrowers and Lenders Act, 2020 (Act 1052).
Speaking at a sensitisation programme organised by the Ghana National Chamber of Commerce and Industry (GNCCI) and the Bank of Ghana (BoG), on the Borrowers and Lenders Act and the operations of the Collateral Registry, she stressed that empowering the private sector with clarity and confidence to access credit remains crucial for national economic growth.
“The private sector is the lifeblood of our economy, and when businesses are empowered with clarity and the confidence to borrow, to invest and to expand, the entire machine progresses,” she noted.
Addressing structural gaps in Ghana’s credit market
Mrs. Asante-Asiedu observed that Ghana’s credit market has historically been constrained by information asymmetry, limited collateral options, weak enforcement mechanisms, and the exclusion of small businesses. These structural deficiencies, she said, elevate the cost of credit and heighten lenders’ risk aversion, ultimately slowing job creation and economic expansion.
To resolve these challenges, she pointed to a series of reforms led by the central bank over the past decade and a half. The first Borrowers and Lenders Act of 2008 set the initial framework for modernising credit practices, but subsequent developments in the economy made an upgrade necessary, leading to the introduction of Act 1052 in 2020.
The revised law strengthens legal clarity around credit agreements, expands the range of movable and immovable assets accepted as collateral, reinforces borrower rights, including fair treatment and comprehensive pre-agreement disclosures and enhances the operational mandate of the Collateral Registry.
Rise in borrower registrations driven by alternative collateral options
Highlighting progress, the Deputy Governor revealed that registrations on the Collateral Registry have expanded markedly. Registered borrowers increased from just 27 in 2010 to 372,902 by 2024. Cumulatively, over 1.3 million borrowers have accessed credit through the system within the same period.
She emphasized that the broader acceptance of movable assets such as inventory, vehicles, equipment, and account receivables has enabled more individuals and businesses – especially MSMEs – to leverage alternative collateral for financing.
Significantly, women accounted for 77% of the growth in registered borrowers, a development Mrs. Asante-Asiedu described as “heartwarming” and a strong signal of progress in financial inclusion and social equity.
Borrower responsibility central to sustainable credit expansion
While applauding the gains, the Deputy Governor stressed that the sustainability of Ghana’s credit ecosystem depends on responsible borrowing. She reminded participants that character remains a fundamental element in lending decisions.
“When borrowers take loans knowing they will not pay back, it raises lending costs for everyone,” she said, warning that individuals who default irresponsibly risk being blacklisted under the new regulatory environment.
She urged borrowers to apply loans purposefully to productive ventures rather than personal consumption, and encouraged open communication with lenders, especially during periods of business difficulty, citing banks’ willingness to restructure loans during the COVID-19 period as an example.
Going forward
Mrs. Asante-Asiedu encouraged businesses to demand transparency from their lenders, seek clarity on all terms and charges, and fully understand their contractual obligations.
She reaffirmed the BoG’s commitment to enhancing secured transactions frameworks, improving credit information quality, strengthening lender confidence, and expanding financial inclusion.
“Together, we have an opportunity to build an ecosystem that is enduring, supports credit creation, and advances the business community and the growth of our economy,” she concluded.
