A groundbreaking initiative is set to empower Small and Medium-sized Enterprises (SMEs) in Ghana’s agriculture, manufacturing, Information, Communications and Technology (ICT), and high-value sectors with access to vital financial support. In a strategic partnership between Development Bank Ghana (DBG) and Proxtera, a Singaporean fintech company, some US$100 million in loans will be made available through a digital platform, offering a lifeline to enterprising businesses across the nation.
The collaboration, formalized on the sidelines of the ongoing 3iAfrica Summit in Accra, marks a significant step towards advancing Ghana’s SME landscape. Mr. Kwamina Duker, CEO of DBG, highlighted the importance of digitization in modern lending practices, stating, “This platform allows that process to be much quicker, and effective, and as a result of that, the risk premium of the interest rate being applied to SMEs will over time come down.”
For SMEs to qualify for these loans, they must be Ghanaian-owned and operating within the country, with a bankable financial plan. Mr. Duker emphasized the transformative potential of this initiative, noting that it could drastically reduce the time and paperwork involved in securing loans.
“If today, it takes about three to six months to get a loan, with a huge amount of documentation, and we can cut that down to a turnaround of literally a real-time of 24-hours… then we can appreciate the benefits of digitalization,” he affirmed.
Furthermore, Mr. Duker underscored DBG’s role as a catalyst in de-risking the environment for other banks to support SMEs, thereby stimulating job creation and economic growth. This initiative builds on DBG’s successful efforts in sectors such as rubber and rice, where it has not only provided financing but also inspired confidence among other financial institutions to follow suit.
Echoing this sentiment, Mr. Saurav Bhattacharyya, CEO of Proxtera, highlighted the transformative potential of their technological platform in facilitating quick evaluation and disbursement of loans for SMEs. Ghana becomes the fourth country to benefit from their platform, with Mr. Bhattacharyya expressing confidence in its ability to address the credit access challenge faced by Ghanaian SMEs.
This partnership between DBG and Proxtera signifies a pivotal moment in Ghana’s journey towards digital financial inclusion, promising to unlock new opportunities and propel SMEs towards sustainable growth and prosperity