Banks in Ghana have no option but to step up lending as policy rates continue to fall, according to the President of the Association of Ghana Industries (AGI), Dr Humphrey Ayim-Darke.

Speaking on Joy News’ PM Business Edition, he said the reduction in the Bank of Ghana’s monetary policy rate leaves the financial sector with little room to hold back.

“This gives further assurance to the bank, besides the DBG one that is coming up; it’s also going to aid stimulate the banks to do more lending, because all such funds that will be underwritten by such guarantee schemes will give them that freedom and the capacity to go out there and be more daring,” he stated.

The Bank of Ghana last cut its key monetary policy rate by 350 basis points to 21.5% on September 18, 2025, following earlier cuts in July.

The move was driven by sustained disinflation, robust economic growth, and improved external buffers. Inflation has dropped sharply and is projected to hit the medium-term target by the end of 2025.

Dr. Ayim-Darke believes these developments will reinforce banking activity and complement the ongoing macroeconomic recovery.

“Complimentary all the macro gains and the drive of the Bank of Ghana (BoG) and the fiscal consolidation that is happening within that context, the banks will be to be positioned,” he said.

He explained that market forces now leave banks with no choice but to shift into lending.

“They have no other choice than to come to the market, because the lending T-bill rates are also another factor that is shaping their thoughts and their lending model, real banking is coming to the table, and we in the industry, space and business, believe that definitely it will trend downwards.”

But the AGI President also cautioned that the benefits of falling rates will only be sustained if regulators play their part.

“So we need those other factors and that will speak to, ie, the regulatory authorities, because amidst all these gains that have been attained within this period.

"The flip side, or the derailing factors that may come to the table, are the role of the various regulatory authorities supporting industry,” he warned.