Dr. Kweku Arthur-Annobil, Business Strategy Manager of Business and Commercial Banking at Stanbic Bank Ghana, has made a compelling case for Ghanaian banks to innovate in their support for women-led businesses.

Speaking at a multi-stakeholder engagement focused on enabling resilient women-led businesses in Ghana, Dr. Arthur-Annobil emphasized the critical role that financial institutions must play in fostering the growth and sustainability of these enterprises, particularly in the face of current economic challenges.

The economic difficulties of recent years, notably the lingering effects of the COVID-19 pandemic, have placed significant strain on businesses in Ghana. According to Dr. Arthur-Annobil, this has led to a sharp increase in the Non-Performing Loans (NPL) ratio, which has risen from 15% in early January 2023 to nearly 30%. This alarming trend reflects the financial hardships many businesses are experiencing, not due to poor management or fraudulent activities, but because of genuine macroeconomic challenges.

In light of this, Dr. Arthur-Annobil called on banks to innovate in their approach to supporting women-led businesses. He argued that while banks must manage liquidity issues and navigate regulatory constraints, they also have a responsibility to help businesses survive and thrive. This requires a shift in traditional banking practices, with a focus on creating more flexible, supportive, and sustainable financial solutions.

Stanbic Bank’s Beyond Banking Initiatives

Stanbic Bank Ghana has already taken steps to address the unique needs of women-led businesses through its “beyond banking” initiatives. Dr. Arthur-Annobil highlighted several partnerships with development financial institutions and fintech companies that have enabled the bank to provide grants and concessionary loans to businesses facing difficult times. These partnerships are crucial in offering financial relief to women entrepreneurs who might otherwise struggle to secure traditional bank loans.

One of the key offerings from Stanbic Bank is the SB Incubator, a platform designed to provide capacity-building programs specifically tailored to women-led businesses. These programs aim to equip women entrepreneurs with the skills, knowledge, and resources they need to grow and sustain their businesses in a competitive market.

Additionally, the bank has introduced the Enterprise Smart Loans, a collateral-free loan product focused on cash flows and business behavior rather than traditional collateral requirements. This product is particularly beneficial for micro-businesses, which often lack the assets needed to secure a loan through conventional means. By removing this barrier, Stanbic Bank is empowering women entrepreneurs to access the capital they need to grow their businesses.

The Importance of Proper Documentation and Financial Management

Dr. Arthur-Annobil also addressed the importance of proper documentation for securing loans. He explained that thorough documentation allows banks to better understand the nature and dynamics of a business, enabling them to provide more targeted support and advice. This understanding is crucial not only for securing a loan but also for ensuring that the funds are used effectively to drive business success and sustainability.

In addition to documentation, Dr. Arthur-Annobil emphasized the need for women-led businesses to separate their personal and business finances. This practice, he noted, is essential for maintaining financial clarity and ensuring that business resources are used appropriately. The COVID-19 pandemic underscored this lesson, as many businesses that failed to separate their finances struggled to survive the economic downturn.

A significant part of Dr. Arthur-Annobil’s message was the call for micro and small businesses to adopt a growth-oriented mindset. He urged entrepreneurs to leverage technology to expand their operations without necessarily increasing their physical presence. This approach, he argued, would not only help businesses withstand economic challenges but also position them for long-term growth and success.

Dr. Arthur-Annobil also called on banks to embrace innovative solutions and support mechanisms that can bolster the resilience of women-led businesses. By doing so, banks can play a pivotal role in driving broader economic transformation and ensuring that businesses, particularly those led by women, can thrive even in turbulent times.

The multi-stakeholder meeting where Dr. Arthur-Annobil spoke was part of ongoing research led by Dr. Richmond O. Lamptey, a Lecturer at Cardiff Metropolitan University in Wales. The research project, titled “Enabling Resilience of Women Businesses During Turbulent Times in Ghana,” is supported by The British Academy and aims to investigate and enhance the resilience of women-owned businesses in Ghana during periods of economic and social instability.