The Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH (GIZ) has call on financial service providers to innovate financial products to reduce MSME financing gap in Ghana.
Micro, Small, and Medium Enterprises (MSMEs) employ about 80 percent of Ghana’s working population; however, access to finance is a significant obstacle for them.
Mr. Detlev Axel Jahn, the Programme Manager of the Programme for Sustainable Economic Development (PSED), speaking at the GIZ’s Financial Products Launch event for MSMEs themed: “Innovative financial products to reduce the MSME financing gap,” revealed that access to financial services is a significant challenge most MSMEs face in their operations, adding that, they do not have a complete understanding of the range and requirements for financial products, including insurance.
“Financial service providers have what it takes to provide financial services, and MSMEs also need these products. However, there is a disconnect between this demand and supply; hence, this project by GIZ is to build the capacities of companies to design tailored-made services for MSMEs. This event forms part of GIZ’s Programme for Sustainable Economic Development (PSED) project, an intervention that seeks to address MSMEs access to finance challenge.”
Mr. Detlev Axel Jahn
Financial products initiative to reduce financing gap
Mr. Jahn said the goal of the financial products initiative is to reduce the financing gap of MSMEs in the country.
“The objective is to improve MSME access to financial services through support to enhance the supply of need-based financial and insurance products and services, together with accompanying measures to develop the capacity of MSMEs to access and benefit from these products and services.”
Mr. Detlev Axel Jahn
He said the programme, in the end, would enable MSMEs to save and invest efficiently to grow their businesses and create more jobs.
M.r Michael Kofi Andoh, Deputy Commissioner, National Insurance Commission, speaking at the event, appealed to financial institutions to educate and build capacities of MSMEs to understand their financial services and products for easy accessibility to scale up their operations.
He also called for financial services and products that align with the needs of Micro, Small, and Medium Enterprises (MSMEs).
He said, “there is a demand and supply disconnect between these services and the needs of the MSMEs, which makes it difficult for MSMEs to access them”.
The event provided financial service providers, regulators, and customers the chance to learn more about the benefits of the new products and discuss how to improve MSMEs’ access to financial services.
Five Ghanaian financial service providers have officially launched their newly developed financial products to reduce Micro Small Medium Enterprises (MSMEs) inability to access financial services in the country.
The products by the financial service providers include Madwuma Ntoboa Savings Plan and Nkosuo Bosea Loan Solution by Letshego Savings and Loans, amongst others.
GIZ’s Responsible enterprise finance
GIZ, over the years, has helped financial service providers introduce new lending products and services to promote sustainable investments, enable partnerships with technology providers, business associations, and other service providers, and support MSMEs in meeting the requirements of financial institutions.
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