BoG must facilitate productive-sector financing — or enable a specialized value-chain industrial bank

Ghanaian banks are lending again, but where the money goes could determine whether the 24-Hour Economy delivers an industrial transformation or merely fuels another cycle of consumption and imports.

Total bank advances jumped 38.6 percent to GH¢124.3 billion in June 2026, from GH¢89.7 billion a year earlier, while private-sector credit expanded 41.2 percent. Yet the structure of lending shows that the productive sectors expected to drive the 24-Hour Economy continue to receive relatively small shares of private-sector credit.

At the end of 2025, manufacturing received about GH¢11.8 billion, or 11.1 percent, of outstanding private-sector credit, while agriculture, forestry and fisheries received just GH¢4.8 billion, or 4.5 percent. Commerce and finance accounted for approximately GH¢17.6 billion, while the broader services sector received about GH¢39.5 billion.

This allocation becomes increasingly important as falling interest rates change where banks deploy their money.

The average lending rate declined from 27 percent in June 2025 to 15.64 percent in June 2026, while the 91-day Treasury bill rate dropped from 14.74 percent to 5.27 percent.

With government securities offering significantly lower returns, banks have a stronger incentive to search for alternative earning assets.

The danger is that capital could increasingly migrate into consumer loans, personal credit and short-term commercial financing while farms, factories, processors and exporters continue to struggle for appropriately structured capital.

Ghana could then achieve macroeconomic stability without achieving productive transformation.

The Financing Mismatch

A factory operating additional shifts requires more than workers. It needs raw materials, working capital, machinery, energy, packaging, inventory, logistics and distribution finance.

The financing requirement extends across the entire value chain. Farmers need capital before planting; plantations may require years of patient financing before maturity; aggregators need procurement finance; manufacturers need equipment and working capital; and exporters require funding between production and payment by foreign buyers.

Much of this cannot be adequately financed with short-tenor credit designed primarily for commercial transactions.

The issue is therefore not simply the availability of credit, but whether Ghana's financial architecture can match the tenor, risk profile and cash-flow cycles of productive investment.

That is where the Bank of Ghana can play a catalytic role without becoming a lender itself.

BoG Should Facilitate, not Lend

The Bank of Ghana does not need to become Government's industrial bank or direct commercial banks on which companies to finance.

Its role should be to facilitate the regulatory and prudential environment that allows appropriately structured productive-sector financing to expand without compromising financial stability.

One option is a dedicated Productive Sector and Value-Chain Finance Facilitation Unit working with banks, development finance institutions, manufacturers, agribusinesses, exporters, insurers and pension funds.

Its focus could include long-tenor industrial credit, agricultural and biological-asset finance, equipment leasing, warehouse and receivables finance, purchase-order finance, export credit, guarantees and offtake-backed lending.

This would not require weaker lending standards. It would require better structures for assessing productive businesses.

Credit assessment should not depend overwhelmingly on land and buildings when viable businesses also possess machinery, receivables, purchase orders, supply contracts, export contracts and credible offtake agreements capable of supporting repayment.

Ghana needs to move gradually from collateral banking towards value-chain banking.

A Specialised Industrial Bank

Where commercial banks cannot sufficiently adapt their funding structures, risk models and lending tenors, Ghana should also consider facilitating a specialized Value Chain Industries Bank.

It need not be another wholly state-owned institution. Private investors, financial institutions, pension funds, industry associations, development partners and Government could participate, with a mandate focused on financing productive value chains from agriculture and raw materials through processing, manufacturing and exports.

Commercial banks could participate through co-lending, guarantees and syndication, while the Bank of Ghana maintains regulatory oversight.

The two approaches are not mutually exclusive. A BoG facilitation structure would address regulatory and financing constraints across the banking system, while a specialized institution could provide the patient and appropriately structured capital that conventional commercial banking may struggle to supply.

Credit Must Finance Production

Consumer credit itself is not the problem.

The problem arises when credit expands domestic demand without a corresponding increase in domestic production.

If banks increasingly finance imported vehicles, appliances, electronics, furniture and other goods while local producers struggle for working capital, domestic finance risks supporting production abroad while adding to foreign-exchange demand at home

That is precisely the imbalance the economic reset should avoid.

Ghana has worked hard to bring down inflation, interest rates and Treasury yields. Those gains must now create conditions for investment, production, employment and exports.

The challenge now is to ensure that the rapid expansion in private-sector credit translates into productive investment rather than simply higher consumption and short-term commercial activity.

If more of this expanding credit reaches farms, factories, machinery, processing and exports, the banking system can become a powerful engine of the 24-Hour Economy.

But if productive businesses remain starved of suitable capital while finance gravitates towards consumption and short-term commerce, Ghana risks restoring macroeconomic stability without transforming the structure of its economy.

Government can create the policy environment. Industry can provide the productive capacity. Finance must provide the bridge between the two.

You cannot build a 24-Hour Economy with an eight-hour financing mindset.

Without a deliberate shift towards financing production, the existing banking model could draw a dagger through the 24-Hour Economy before the gains of Ghana's economic reset reach the factory floor.