In a move to bridge the financing gap for micro, small, and medium-sized enterprises (MSMEs) in Ghana, 15 financial service providers have partnered with the Support to Private and Financial Sector (PFS) Programme.
Funded by the German Cooperation through Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, this initiative aims to develop innovative financial products tailored specifically to the needs of MSMEs.
A kick-off meeting held in Accra brought together key stakeholders, including insurance and pension regulators, partner financial service providers, and consultants. The meeting served as a platform for stakeholders to discuss and strategize on improving MSMEs’ access to financial services through the development of these new financial products.
The new financial products will encompass a range of offerings, including loans, savings, investments, and bundled products. The primary focus of this initiative is on MSMEs, with particular emphasis on businesses owned or operated by women, youth, and persons with disabilities (PWDs).
Angela Armah from GIZ articulated the significance of this initiative during the meeting, stating, “GIZ is happy to support this because MSMEs are considered efficient and prolific job creators, the seeds of big businesses, and the fuel of national economic engines. We are here to discuss together how we bring need-based financial products to the doorstep of MSMEs.”
Challenges Faced by MSMEs
Despite their critical role in the economy, employing approximately 85% of Ghana’s workforce, MSMEs continue to face significant challenges in accessing finance. Many MSMEs lack a comprehensive understanding of the various financial products available and the requirements associated with them. This knowledge gap often hampers their ability to secure the necessary financing to grow their businesses.
The initiative aims to address these challenges by developing tailored financial solutions that enhance MSMEs’ access to finance. By doing so, it hopes to empower these enterprises to expand their operations, create more employment opportunities, and contribute more significantly to the national economy.
To achieve these objectives, GIZ has partnered with 15 financial service providers and 15 trade associations. This collaborative effort underscores GIZ’s commitment to fostering economic growth and supporting the backbone of Ghana’s economy—its MSMEs.
The participating financial service providers bring a wealth of experience and expertise in developing and offering financial products. Their collaboration with trade associations ensures that the developed products will be well-suited to the unique needs and challenges of MSMEs in various sectors.
Innovative Financial Products for Enhanced Access
The development of innovative financial products is a cornerstone of this initiative. By creating products that are specifically designed for MSMEs, the initiative aims to make financial services more accessible and relevant. These financial products will include loans, savings, investments and bundled products. The primary target of this product development intervention is on MSMEs, with particular attention to businesses owned or run by women, youth, and persons with disabilities (PWDs)
The initiative places particular emphasis on supporting businesses owned or run by women, youth, and persons with disabilities. These groups often face additional barriers in accessing finance, and tailored financial products can help mitigate these challenges. By focusing on inclusivity, the initiative aims to create a more equitable financial landscape for all MSMEs.
The partnership between 15 financial service providers and GIZ represents a significant step forward in addressing the financing challenges faced by MSMEs in Ghana. By developing innovative, need-based financial products, this initiative aims to enhance MSMEs’ access to finance, enabling them to grow their businesses, create jobs, and contribute to the national economy
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