Small and Medium-sized Enterprises (SMEs) continued to face high borrowing costs in May 2026 despite the Ghana Reference Rate remaining unchanged at 10.03 per cent, according to the latest Annualised Percentage Rates (APR) report released by the Bank of Ghana (BoG).
The report indicates that while the benchmark lending rate remained relatively low, many businesses were paying significantly higher effective borrowing costs after interest charges and other loan-related fees were factored in.
The Annualised Percentage Rate measures the total cost of borrowing, including interest and all applicable charges, providing borrowers with a more comprehensive basis for comparing loan products offered by banks.
According to the report, the lowest APR for a one-year SME loan was 11.03 percent, offered by Standard Chartered Bank Ghana Limited, while the highest reached 33.58 percent at Guaranty Trust Bank (Ghana) Limited.
For three-year SME facilities, borrowing costs ranged from 13.34 percent at Stanbic Bank Ghana Limited to 31.09 percent at Universal Merchant Bank Limited.
The report further showed that APRs on five-year SME loans ranged between 13.97 percent at Ecobank Ghana Limited and 25.07 percent at Agricultural Development Bank Limited.
The wide variation in borrowing costs highlights the differing pricing models adopted by banks, despite operating under the same benchmark reference rate.
According to the Bank of Ghana, lending rates vary across financial institutions based on factors including credit risk assessments, operating costs and other charges associated with individual loan facilities.
The central bank reported that the average APR across all loan categories stood at 17.64 percent in May, considerably higher than the Ghana Reference Rate of 10.03 percent.
High financing costs have remained a major concern for businesses, particularly SMEs, which rely heavily on bank credit to finance working capital, acquire equipment, expand production and create employment.
Business associations have consistently argued that elevated lending rates constrain private sector growth by limiting access to affordable credit, reducing investment and slowing business expansion.
SMEs remain a critical pillar of Ghana’s economy, accounting for approximately 92 percent of businesses nationwide and contributing nearly 70 percent of the country’s Gross Domestic Product (GDP), according to government and industry estimates.
The Bank of Ghana publishes the APR report monthly as part of efforts to improve transparency in the financial sector and enable borrowers to compare the true cost of credit across banks before taking lending decisions.
