BoG Governor Urges Banks to Boost Lending Amid Signs of Economic Recovery

Governor of the Bank of Ghana (BoG), Johnson Pandit Asiama, has urged commercial banks to significantly increase lending to both businesses and individuals, pointing to easing inflationary pressures and a recent cut in the monetary policy rate as clear indicators of an improving economy.

Push for Credit Expansion

Speaking at a press briefing in Accra, Dr. Asiama emphasized that the country’s recent macroeconomic gains must translate into real benefits for the private sector. “The lower cost of borrowing and improved stability in the cedi should be the green light for banks to ease credit conditions,” he said, stressing that the private sector remains the engine of job creation and growth.

The BoG recently cut the monetary policy rate from 29% to 27%, marking the second consecutive reduction in 2025, after inflation slowed from 32.1% in January to 24.8% in July. The central bank attributes the improvement to prudent fiscal management, increased foreign exchange reserves, and better performance in key export sectors.

Economic Impact

Analysts say a rise in lending could inject fresh capital into small and medium-sized enterprises (SMEs), spur investment, and strengthen household consumption — all vital to sustaining the rebound. However, concerns remain about potential credit risk if banks loosen lending standards too quickly.

The BoG has indicated it will closely monitor lending practices to ensure credit growth does not compromise financial stability. “This is the moment for banks to act decisively but responsibly,” Dr. Asiama concluded.

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