24-Hour Economy Authority, BoG, NIC to roll out credit insurance scheme for SMEs

The 24-Hour Economy Authority says it is collaborating with the Bank of Ghana and the National Insurance Commission to develop a credit insurance guarantee scheme aimed at improving access to finance for businesses.

The proposed scheme is expected to reduce reliance on physical collateral, a major barrier that currently limits about 95% of businesses from securing loans.

Presidential Advisor on the 24-Hour Economy and Accelerated Export Development Programmes, Augustus Goosie Tanoh, disclosed this to the media after a meeting between the Ghana National Chamber of Commerce and Industry (GNCCI) and the 24-Hour Economy Secretariat.

He explained that the initiative will be implemented alongside Enterprise Support Organizations to help make small and medium-sized enterprises (SMEs) “credit ready.”

This will involve strengthening corporate governance, improving financial management, and enhancing market access.

“We are talking to the Bank of Ghana for regulatory forbearance and also the National Insurance Commission to develop and implement a credit insurance guarantee scheme that will allow for loans and credits advanced to SMEs and those in the 24-hour value chain to be insured so that we don’t have to rely constantly on property and other physical assets as the collateral.

“So the idea is to resolve the collateral problem but in tandem work to develop what we call enterprise support organizations (ESOs) that basically work with the chosen SMEs prepare them for credit to credit readiness in terms of their governance, their financial management, their markets and all the value chain components that make for a good business.

First Vice President of GNCCI, Dr. Mrs. Emelia Assiakwa, welcomed the move but stressed the need for swift implementation to address persistent financing challenges within the private sector.

“You realize that they [banks] were putting a lot of impediments in the way with a lot of conditions which of course we also understand the conditionalities that they were putting in place but looking at the system or the mechanism that is being put in place with the insurance policy and everything, you can be very sure that it wouldn’t be bad at all.

“It is going to be smooth for the private sector to access some of these facilities. All that we want is that at the end of it all there is support from the government where the government is doing everything in their power to give the private sector that kind of support that we need and I think that Ghana will become a better nation,” she said.

The meeting between the Ghana Chamber of Commerce and Industry (GNCCI) and the secretariat focused on a strategic partnership to support SMEs across 17 sectors.

This collaboration will be formalized through a Memorandum of Understanding (MOU) and the establishment of a joint technical committee to oversee implementation.