As part of the effort to drive the growth of Micro, Small, and Medium-sized Enterprises (MSMEs), the United Nations Capital Development Fund (UNCDF), together with its partners, is championing an ambitious initiative aimed at transforming how small businesses access finance.
The initiative, dubbed the Joint SDG Fund Programme, leverages Ghana’s rapidly expanding digital finance to create an enabling environment that can effectively fund MSMEs growth.
The three-year programme, running from 2024 to 2027, is jointly implemented by UNCDF, United Nations Development Programme (UNDP), and the United Nations Conference on Trade and Development (UNCTAD) under the leadership of Ghana’s Ministry of Trade, Agribusiness and Industry. It is funded by the European Union through the Joint SDG Fund.
Why the Initiative
For years, access to finance has long remained one of the biggest obstacles preventing Ghana’s Micro, Small, and Medium-sized Enterprises (MSMEs) from growing into resilient and competitive businesses. Despite accounting for about 92% of businesses, generating nearly 80% of employment and contributing approximately 60% of Ghana’s Gross Domestic Product (GDP), most MSMEs, particularly those owned by women and young entrepreneurs, continue to struggle to secure affordable financing due to stringent lending requirements, high interest rates, and limited collateral.
It is against this backdrop that the partners are championing this initiative. The programme aims at leveraging digital ecosystems for increased MSMEs’ productivity. It positions digital finance as a practical solution to bridge Ghana’s longstanding MSME financing gap while improving productivity and business resilience.
Rather than focusing solely on lending, the programme addresses the broader ecosystem that determines whether small businesses can thrive. It combines policy reforms, digital infrastructure, and innovative financial services to remove the systemic barriers that have historically constrained MSME growth.
The Pillars of the Initiative
The first focuses on developing an e-commerce policy and strategy led by UNCTAD to create an enabling regulatory environment for digital commerce. The second, spearheaded by UNDP, is establishing a Digital Gateway platform to provide business support services for MSMEs.
The third pillar, led by UNCDF, is developing innovative digital financial products specifically designed to expand access to finance for women and youth-led enterprises.
The Expected Impact
Collectively, these interventions are expected to enable 25,000 MSMEs to access digital financial services, equip 10,000 businesses with digital and financial skills, and mobilise approximately US$13.6 million in additional capital through a targeted leverage ratio of one dollar in concessional funding to four dollars of private investment by 2027.
Central to the initiative is the deliberate effort to rethink MSME financing by designing financial products around the realities of small businesses rather than expecting businesses to fit traditional banking models.
Recognising that many MSMEs operate informally and lack the financial records required by conventional lenders, UNCDF has invested US$600,000 in investment grants and technical assistance to selected Financial Service Providers (FSPs) to develop digital financial solutions grounded in the actual needs of entrepreneurs.
The First Phase
Five financial institutions were competitively selected to participate in the programme’s first phase. At an unveiling event on Thursday, these partner fintech firms demonstrated their solutions.
Fido is developing a digital lending product for small businesses, while Adehyeman Savings and Loans, in partnership with fintech company Oze, is introducing rural savings and loan products supported by digital credit scoring technology.
Moreover, Mobile Money Limited (MoMo) is developing merchant services and digital bookkeeping solutions for MSME agents, Solis Finance is building a digital savings and loans platform targeting informal enterprises.
Opportunity International is focused on expanding microfinance products specifically for women and youth-led businesses. At the event, all five institutions confirmed that they have completed prototype development and user testing.
The Phase 2
Under the programme’s second phase, the two strongest-performing institutions will each receive up to US$200,000 to pilot and scale their validated products.
Although Ghana has become one of Africa’s leaders in digital finance, with more than 22 million active mobile money accounts and mobile money transactions reaching GH¢3.019 trillion in 2024, many small businesses remain excluded from formal lending because they cannot produce conventional financial statements.
The Bottomline
The Joint SDG Fund Programme seeks to cause a transformative change in Ghana’s MSMEs sector by enabling financial institutions to assess creditworthiness using mobile money transaction histories and other digital financial records instead of relying solely on traditional collateral and formal accounting records.
For thousands of entrepreneurs, particularly women and young business owners who dominate Ghana’s informal economy, the initiative could represent the difference between remaining trapped in subsistence operations and expanding into sustainable enterprises capable of creating jobs.
By supporting digital financial innovation, UNDCF is strengthening local financial ecosystems and making underserved markets investable. It also aims to create pathways through which private capital can sustainably reach businesses that have historically been excluded from formal finance.
