The Chief Executive Officer of the Ghana National Chamber of Commerce and Industry (GNCCI), Mark Badu Aboagye, says commercial banks have exhausted all excuses for failing to lend adequately to the private sector.
He argues that government’s significant reduction in borrowing has removed the main barrier banks previously cited, leaving them with only one responsible option to channel funds into real businesses.
Speaking on Joy News’ PM Express Business Edition on Thursday, Badu Aboagye stressed that Ghana’s economic recovery depends on a renewed and intentional partnership between the banking sector and private enterprise. He noted that idle liquidity benefits no one and must be directed toward productive sectors of the economy.
He stated that now that government has stopped absorbing bank liquidity through high-yield Treasury bills, the flow of credit to businesses must increase deliberately and consistently.
“For me, economic development is a partnership. The banks must play their role,” he emphasised.
According to him, banks no longer enjoy the luxury of making effortless profits by lending heavily to government at high interest rates a practice that once guaranteed easy returns.
“Now that government is not borrowing, and with the T-bill rate now around 10%, gone are the days when it was 25%, where banks would simply lend to government, go and sleep, and make huge profits,” he said.
With government stepping back, he explained, the only meaningful destination for bank capital is the private sector.
“Government is not borrowing, so you have no option but to give it to the private sector,” he stressed.
Badu Aboagye added that there are early signs of progress, noting that credit to businesses has begun to rise. He believes this momentum must continue if Ghana is to achieve sustainable economic transformation.
“We have seen an increase in credit to the private sector, and I’m sure it will be sustained. That is how we move our economy forward,” he said.
He further argued that lower interest rates would benefit both sides. Affordable loans, he said, would give businesses the confidence to borrow while reducing the risk of loan defaults for banks.
“If interest rates come down, businesses will borrow more, and the banks will also do well. They will make more profit because non-performing loans will decline,” he explained.
Badu Aboagye concluded by emphasizing that the Chamber expects banks to follow through on their commitments.
“We are holding them to their word. We are all here. We will be analysing and assessing,” he said.
