"Covid-19 Firm Tracker: Firms’ access to financial services increased 10-folds amid Wave III

" \n Covid-19 Firm Tracker: Firms' access to financial services increased 10-folds amid Wave III - GSS \n \n\n \n The Ghana Statistical Service [GSS] has revealed that firms experienced 8.6 percent increment in access to financial services during the country's third wave of the covid-19 pandemic. \n \n\n \n According to the GSS' Covid-19 Rapid Firm Tracker, firms showed some level of financial recovery some months after the emergence of the pandemic and its accompanied restrictions and partial lockdown in the country. \n \n\n \n The tracker further noted that access to financial services by businesses in the country increased ten times as firms experienced a 8.6 percent access to financial services in Wave III as compared to the 0.8 percent recorded in Wave II. \n \n\n \n \"Firms showed some level of financial recovery some months after the emergence of Covid-19 pandemic in the country with its accompanied restrictions including the partial lockdown. From 0.8 percent in Wave II to 8.6 percent in Wave III, business establishments (all firms) have experienced an increase in access to financial services,\" the GSS stated in its report . \n \n\n \n Sectors such as the accommodation and food sectors the report further notes, recorded the highest access to financial services with 13.1% in Wave III from 0.2% in Waves I and II. \n \n\n \n However, the agricultural and industries sector, recorded a decline in access to finance with a 8.7% in Wave II to 3.7% in wave III. \n \n\n \n \"Across sectors, the accommodation and food sector recorded the highest access to financial services in Wave III (13.1%) from 0.2 percent in Waves I and II. The agricultural and other industries sector, however, experienced a decline in access to finance from a recovery of 8.7 percent in Wave II to 3.7 percent in Wave III,\" the Service noted. \n \n\n \n Cashflow for business establishments, the report further reveals, saw some significant recovery from as low as 1.9 percent in Wave I to 9 percent in Wave II and a further increase to 24.6% in Wave III. \n \n\n \n It added that unlike access to finance, all sectors experienced an increment in their cashflows across the three waves, with the manufacturing sector recording the highest increment in recovery with 32.1 percent of businesses in the sector reporting an increase in cashflow in Wave III.\u00a0 \n \n\n \n \"Cashflow for business establishments have also seen significant recovery from as low as 1.9 percent of business establishments reporting an increase in cashflow in Wave I to 9 percent in Wave II and a further increase to 24.6 percent in Wave III. \n \n\n \n \"Unlike access to finance, all sectors experienced an increase in their cashflows across the three waves. The manufacturing\u00a0sector experienced the highest recovery with 32.1 percent reporting an increase in cashflow in Wave III from 0.8 percent in Wave I,\" the GSS posited. \n \n\n \n Meanwhile, the Bank of Ghana has indicated that the stock of gross loans and advances given out to public and private sectors amounted to GHC53.9 billion at the end of 2021. \n \n\n \n This represents an annual growth of 12.9% in gross loans and advances made to public and private sectors as compared to the 5.8% growth in 2020. \n \n\n \n According to the Monetary Policy Report by the Bank of Ghana, private sector credit which accounted for the biggest share of total credit (90% of total credit), recorded a marginal increase in growth from 10.6% to 11.5% during the review period. \n \n\n \n The report also noted that the public sector experienced some significant improvement in credit growth in 2021 [27.1%], contrary to the contraction in the sector in 2020 [27.0%], while its share in total credit inched up to 10.0 percent from 8.9 percent during the same comparative period \n \n\n \n \"Public sector credit increased by 27.1 percent in 2021 from a contraction of 27.0 percent in 2020 while its share in total credit inched up to 10.0 percent from 8.9 percent during the same comparative period. In terms of sector classification of credit allocation, the services sector held the largest share of 35.0 percent in total credit as at end-year 2021. \n \n\n \n \"This was followed by the commerce and finance sector and the manufacturing sectors with respective shares of 18.5 percent and 10.8 percent. These three sectors therefore accounted for 64.3 percent of total credit in 2021 compared with the 61.9 percent in December 2020. \n \n\n \n \"The remaining share of 35.7 percent was distributed across five other economic sectors in various proportions. The mining and quarrying sector was the lowest recipient of industry credit with a share of 1.5 percent at end-year 2021, compared with a 2.5 percent share in the previous year\", the report stated. \n \n\n \n The banking sector\u2019s exposure to credit risk, the report also noted, was slightly elevated due to the lingering adverse impact of COVID-19 on borrowers\u2019 capacity to repay their loans. \n \n\n \n Consequently, the non-performing loans (NPL) ratio of the sector inched up from 14.8 percent in 2020 to 15.2 percent in 2021 on the back of impairment of some facilities by some banks during the period.\u00a0 \n \n\n \n The Bank of Ghana\u2019s Monetary Policy Report highlights the economic and financial sector assessments that the Monetary Policy Committee considered prior to the policy decision during the 104th meeting held in January 2022. \n "

"Covid-19 Firm Tracker: Firms’ access to financial services increased 10-folds amid Wave III

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