The Bank of Ghana is signalling a possible rethink of what lenders can accept as security as it seeks to address persistent barriers to financing for small and medium-sized enterprises.
Second Deputy Governor of the Bank of Ghana, Matilda Asante-Asiedu, said the current reliance on land, buildings, equipment and financial instruments does not fully reflect how businesses create value today.
“A great deal of the value being created in Ghana today sits in contracts, in receivables and in transaction histories rather than in fixed assets, but our systems have not yet caught up with that shift,” she said.
Speaking at the Distinguished Digital Finance Lecture, Mrs. Asante-Asiedu said a business could have strong turnover and a signed contract with a defined payment date but still be denied financing because it lacks conventional collateral.
She pointed to confirmed purchase orders, export contracts and multi-year service agreements as forms of future income that can be verified by lenders but are not currently treated as collateral in the same way as a mortgage or fixed deposit.
“These are claims on future income that can be verified today,” she said.
The Second Deputy Governor said the issue was not necessarily a lack of lender judgement, but the legal and prudential framework governing how such assets can be used in lending.
“What is missing is not the lender’s judgement. It is the legal and prudential architecture that would let that judgement translate into capital relief, the assignment framework that makes the claim enforceable ahead of other creditors, and the collateral eligibility rules that would let a bank hold it as security rather than treat it, for capital purposes, as if it were unsecured,” she said.
Mrs. Asante-Asiedu subsequently made the issue one of four commitments outlined in her speech.
“Second, we will look seriously at what our frameworks allow a lender to count as security,” she said.
She added that a business holding a signed contract with a defined payment date should not be turned away simply because the value it has created sits in a receivable rather than a title.
The comments come against the backdrop of an estimated $4.8 billion annual financing gap facing Ghanaian SMEs, which Mrs. Asante-Asiedu described as one of the more severe gaps on the continent despite the country’s comparatively sophisticated financial sector.
She also identified invoice discounting, through which businesses can access working capital against outstanding receivables, as an instrument that remains underdeveloped relative to the needs of Ghana’s SME sector.
The proposed shift would not remove traditional collateral requirements, but could broaden the range of assets and business information considered when lenders assess creditworthiness, subject to changes in the relevant legal and prudential frameworks.
