The Ghana Union of Traders Association (GUTA) is demanding a sharp reduction in lending rates to single digits, warning that the current cost of credit is crippling businesses and threatening private sector growth.

President of GUTA, Clement Boateng, made the call during an engagement with the Minority in Parliament, stressing that despite a decline in the Bank of Ghana policy rate to 14%, commercial banks continue to lend at rates exceeding 20%.

“Some are lending as far as 22 to 24%, which I think is not the best,” he said. “Once the policy rate keeps going down, we expect a corresponding decrease in lending rates.”

According to him, the failure of banks to adjust their lending rates in line with the central bank’s policy direction is placing unbearable pressure on businesses, many of which rely on credit to survive and expand.

Mr Boateng noted that although the policy rate was recently reduced from 15.5% to 14%, the expected relief has not trickled down to the private sector. He described the situation as unsustainable, particularly at a time when businesses are grappling with high operating costs.

He also drew comparisons with other countries in the West African sub-region, pointing out that nations such as Côte d’Ivoire and Senegal offer single-digit lending rates, making credit more accessible to businesses.

“We are the second biggest economy in the sub-region after Nigeria, so I don’t see why countries like Senegal and Côte d’Ivoire are lending at single digits while Ghana’s commercial banks continue to lend at double digits,” he argued.

Mr Boateng is therefore calling on the Bank of Ghana to step in more forcefully as a regulator to ensure that reductions in the policy rate are reflected in commercial lending rates.

He emphasised that access to affordable credit is critical for job creation, noting that the private sector remains the largest employer in the country.

“All the employment in this country is being generated by the private sector. If businesses are to expand and create jobs, they need access to affordable capital,” he said.