The Member of Parliament for Okaikwei Central, Patrick Boamah has commended the Bank of Ghana for its decision to set aside 2 percent of reserves of banks to support Small and Medium-scale Enterprises (SMEs).
According to him, the move has the potential to engender massive growth in that sector to create much-needed jobs.
“Bank of Ghana is making available close to GH¢2 billion to interested banks who would want to help SMEs. This amount is going to help expand the economy and grow SMEs that in my view create the most employment within the economy. It is a good step by the Central Bank and I commend the governor and his deputies for this important decision and I expect the banks to take advantage of this,” Patrick Boamah told Citi News.
The Governor of the Bank of Ghana (BoG), Dr. Ernest Addison announced on Monday that the Central Bank has set aside GH¢2 billion to finance the activities of SMEs in the country.
While making the announcement at the Monetary Policy Committee (MPC) meeting, he said:
“The Bank of Ghana is setting aside 2% of the banks’ primary reserve to support targeted lending to SMEs as part of the Enterprise Credit Scheme announced in the 2020 budget. These funds will be held at Bank of Ghana and will be available to banks that participate in the scheme.”
Dr. Addison added that this will ensure that they support and strengthen the growth of credit to the private sector.
“The Bank of Ghana will explore the possibility of setting a minimum loan to deposits ratio to ensure that more deposits mobilised by banks are channeled to viable private sector projects. The Bank of Ghana will hold further consultations with the banking industry to determine the impact of such a regulatory measure, and if warranted, determine the level of such a ratio and appropriate monitoring and enforcement mechanisms to promote its effectiveness.”