The current high lending rate offered to non-bank financial institutions by the Central Bank is rendering them uncompetitive and unproductive.
This is according to the Chief Executive Officer of the Women’s World Banking Ghana, Madam Charlotte Lilly Baidoo.
She contends that the high rates offered by the BOG compels them to equally lend at higher rates to customers.
“You know what we are facing right now is that we are dealing mainly with money markets and the monies are very expensive for the kind of business that we do.”
She added “so when we buy the money the cost of fund is very high and it is difficult for us to equally sell it cheap making our business very expensive in the eyes of most Ghanaians”.
Meanwhile Madam Baidoo said the situation has made it difficult for them to increase their client base as most people would prefer to go to a bank where they can access funds at a cheaper rate.
“The banks can go to Bank of Ghana and borrow we can’t go to Bank of Ghana and borrow at a cheap rate of 23%; we buy the money more that 23%, this situation has given them the upper hand in attracting more customers.”
Madam Charlotte Lilly Baidoo said government should set up a fund which non-bank financial institutions could tap into.
“So we plead with the Central Bank or whoever is in charge to set up a fund for us whether it’s a venture capital fund or any other fund so that we can tap into kit and then lending rates will go down”.
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By: Anita Arthur/citibusinessnews.com/Ghana