The Ghana Incentive-Based Risk-Sharing System for Agricultural Lending, known as GIRSAL, was established by the government as a mechanism to reduce the perceived risk that discourages banks from lending to the agricultural sector.
The institution was designed to serve as an intermediary, absorbing a portion of the credit risk on agricultural loans and thereby making it more commercially viable for financial institutions to extend financing to farmers.
In principle, it represents exactly the kind of structural solution that farm leaders have been calling for but in practice, the Peasant Farmers Association of Ghana says it has yet to feel any tangible benefit from the institution’s existence.
Wepia A. Awal Adugwala, National President of the Association, acknowledged having heard of GIRSAL but was unequivocal when asked about its impact on his members. He stated plainly that the Association has “not had any benefit from them,” describing an institution that, from the perspective of smallholder farmers, has not translated its mandate into ground-level results. The assessment was not delivered as a pointed criticism but as a statement of fact, that the gap between institutional design and farmer experience remains wide.
The disclosure raises important questions about the implementation and outreach strategies of agricultural support institutions in Ghana. Adugwala’s framing suggests that GIRSAL’s activities, to the extent they have occurred, have not penetrated the smallholder farming communities that arguably stand to benefit most. Commercial farmers and larger agribusiness operators, who are better positioned to navigate formal financial systems, may be capturing a disproportionate share of whatever risk-sharing support the institution has extended.
Adugwala noted that the same pattern holds for the Agricultural Development Bank, which he described as concentrating its lending activities on commercial-scale farmers rather than the smallholder segment. He argued that this institutional tendency to favour better-formalised borrowers leaves the rural smallholder, who lacks land documentation, off-take agreements, and institutional relationships, without a credible pathway to credit, regardless of how many support structures exist on paper.
He welcomed the government’s reported discussions around agricultural insurance as a related but distinct instrument for managing farm-level risk, and expressed the Association’s willingness to engage in those deliberations. However, he was careful to distinguish between insurance mechanisms and credit access, arguing that both are necessary and that the existence of one cannot substitute for the other. What farmers need, in his assessment, is a comprehensive package: accessible credit, risk mitigation tools such as insurance, and irrigation infrastructure that reduces dependence on rainfall, all working in concert rather than in isolation.
The Association’s position is that government must convene a structured stakeholder dialogue to design lending products that reflect the actual realities of smallholder farming, and that institutions like GIRSAL and ADB must be held accountable not merely for their mandates but for their measurable reach into rural farming communities. Without that accountability, he argued, the institutional architecture around agricultural finance will remain more visible in policy documents than in the lives of the farmers it is meant to serve.
