Compiled By: Prince Henry Danquah, Bora Capital Advisors Ltd.
The share of the microfinance sector to the overall banking sector declined from about 15% to 8.0% between 2017 and 2024.
According to the Bank of Ghana, this decline is not merely a financial outcome, but it reflects a reduced contribution to financial inclusion and development, as well as an erosion of confidence in the sector.
It added that the sector is plagued by persistent fragmentation, weak capital bases, governance deficiencies, operational inefficiencies, high and often indiscriminate interest rates, and widespread mission drift.
“These weaknesses are particularly concerning given the deposit-taking nature of the business”, the Central Bank alluded.
It, therefore, stated that the time is ripe for proactive and deliberate measures to change course and reverse these trends.
Source: newsthemegh.com