Strategic Imperatives for Rural Banks in 2023


The 2022 financial year will soon end and we will be ushered in a new year. It is obvious that some RCBs are excited because they have achieved their target while others are unexcited because they could not achieve their set targets.

However, as important as it is to achieve our target for the year, we must also appreciate the fact that past impressive financial results are lagging indicators which do not guarantee future success. We should therefore strive for leading indicators.

In light of this, the article will highlight some strategic issues that will help the RCBs to remain strong and viable in 2023.

  1. Regular Environmental Analysis

The RCBs operations can be affected by the external environment such as the technological environment and micro-economic environment.

It is therefore imperative that, RCBs undertake consistent environmental analysis to monitor changes and trends in the macro-environment to spot likely opportunities and threats.

In so doing, our RCBs can harness their key strengths to exploit opportunities and strategies to mitigate threats in the external environment.

Management of our RCBs, should also engage in scenario building and come out with contingency plan as we enter a new year of economic uncertainty.

As a CEO or a key management staff, have you taken the pains to read and analyze the 2023 budget and policy statement to acquaint yourself with the policy direction of the government next year? If the answer is no then you must quickly go through to identify opportunities and threats that the budget statement has for your industry.


  1. Ensure Robust Credit Administration

Lending is a core function of banks and therefore cannot be relegated to the background. However, it is associated with risk of default especially in this turbulent economic environment where some businesses are struggling to stay afloat.

There are indications that the unfavourable economic conditions are likely to continue in 2023. Therefore, it is crucial for RCBs to improve their credit administration in order to mitigate credit risk.

On this note the following measures should;

  • Improve the quality of credit appraisal
  • Ensure effective loan monitoring through offsite and on-site
  • Capacity building of credit Officers to help update their skills and knowledge of new credit administration methodology. Please don’t view training as a cost but rather as an investment.
  • Adopt effective loan recovery strategy.
  • Make use of credit reporting system managed by credit bureau, licensed by BoG to know the credit history of loan customers.
  • Fast-track loan delivery process and disbursement because late disbursement of loans has the potential to have adverse effect on loan portfolio quality.
  • Offer credit officers adequate remuneration to prevent them from succumbing to the lure of “loso”.
  1. Adopt Customer Orientation

Customer oriented banks put customers at the center of all their activities and decisions by ensuring that they are satisfied at the end of the day. As we enter into the year 2023 and beyond, forward looking RCBs should remain customer focused as it can drive customer satisfaction, loyalty, advocacy and ultimately improve profitability.

It is significant to state that, there is commoditization of banking products and services. In light of this, our RCBs should endeavor to build emotional connection with their premium (key) customers to wow them and also differentiate themselves. CEOs and key management staff should avoid armchair management. Rather, they should form the habit of visiting key customers to interact with them.

  1. Implementation Of Strong Performance Management

We should remember that excellent performance does not happen by chance. Rather, it should be driven.

To this end, it is vital that our RCBs implement effective performance management that clearly communicate to staff what is expected of them in terms of performance outcome. Staff performance should be tracked and measured. It is worth noting that effective performance management will keep staff on their toes and not loiter around expecting to receive salary at the end of the month.

The Board should also sign performance contract with key management staff and hold them accountable.

Going forward, management of RCBs should link promotion and reward system to performance. This means that the conventional way of promoting staff based on number of years spent should be a thing of the past.

  1. Strengthen microfinance operations

I strongly recommend that RCBs should strengthen their microfinance operations because that space offers a lot of opportunities and is also lucrative when things are done right.

Scores of savings and loans and microfinance companies operating in that ecosystem have seized operations because of the banking sector reforms. This has resulted in market gap which should be closed. Currently in Ashanti region, we have only 6 microfinance companies. The susu savings and loans which are integral part of microfinance should be well packaged as they have the potential to become cash cow.

Mobile Bankers are drivers of susu product and therefore should be repositioned. In that way, they can add professionalism to their work thereby enhancing effective customer interaction and cross-selling.


It is significant to state that, the points discussed so far in the article are not exhaustive. Therefore, management of RCBs who are yearning for additional information should not hesitate to consult me.

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