By Ebenezer Chike Adjei NJOKU
The Bank of Ghana (BoG) has established a committee to reform the Ghana Reference Rate (GRR) in a bid to significantly reduce lending benchmarks, Governor Johnson P. Asiama announced at the Digital Academy launch by the Chartered Institute of Bankers (CIB), Ghana.
Introduced in 2018, the GRR is a key interest rate benchmark used by banks and financial institutions to price their loans and credit products. It was established by the central bank to promote transparency, consistency and fairness in the determination of lending rates.
For June 2025 the rate was 23.08 percent, forming the baseline before institutions apply risk premiums to loans.
The committee forms part of broader efforts to dismantle structural inefficiencies that have kept credit costs elevated, with small and medium enterprises (SMEs) currently borrowing at rates exceeding 30 percent on average.
Speaking to banking industry leaders in Accra, Dr Asiama declared his intention to achieve lending rates below 10 percent before the end of his four-year tenure – a target that he acknowledged has attracted scepticism from market observers.
“We cannot sustain a real sector going forward where SMEs have to borrow at beyond 30 percent and are expected to compete, to grow or to expand. It just does not work,” the Governor said.
The reference rate reform committee represents one of three key interventions designed to reduce credit costs. The central bank is also strengthening the collateral registry and credit referencing systems while engaging commercial banks to improve risk pricing and reduce intermediation costs.
Dr. Asiama stressed the importance of enhanced fiscal-monetary coordination, revealing recent discussions with the Finance ministry on operational improvements. He stated that he has instructed his outfit’s banking department to extend operating hours to facilitate government transactions, citing previous complaints about early closure times hampering fiscal operations.
“Anytime you need to do a transaction that involves crediting government accounts at the Bank of Ghana, just call them. If it is 9 p.m., they have to stay and make sure that transaction is effective,” he said.
While Dr. Asiama chronicled recent gains, he cautioned against complacency – emphasising that “macroeconomic stability is never given. It is earned through discipline, through credibility and through timely reforms”.
The central bank is pursuing three core strategies to rebuild credibility: strengthening its balance sheet through expenditure controls and prudent reserve management; refining policy toolkits including forward guidance and liquidity forecasting; and enhancing transparency to restore market trust, he added.
The event also marked the launch of CIB’s Branch CEO Programme and Ghanaian Bankers magazine.
Dr. Asiama highlighted transformation of the local payments ecosystem, with mobile money accounting for 97 percent of digital transactions by volume and 72 percent by value.
The next phase of digital financial services development will extend beyond basic transactions to encompass savings, insurance, credit and financial literacy platforms.
The apex bank is also finalising regulatory frameworks for digital assets and Virtual Asset Service Providers to support innovation while maintaining consumer protection, the Governor stated.
Governor Asiama stressed the continued importance of branch banking, particularly outside the capital; describing branch managers as “frontline development agents” essential for financial inclusion.
Explaining the rationale behind the Branch CEO Programme, CIB’s Chief Executive Robert Dzato said it aims to develop visionary, responsive and ethically-grounded leadership at the branch level.
“The Branch CEO Programme recognises that our bank branches, particularly those outside Accra, serve as a critical interface between the financial system and everyday citizens,” he explained.
“We cannot achieve true financial inclusion without branch leaders who possess the vision to identify opportunities in their communities, the responsiveness to adapt services to local needs and the ethical foundation to build lasting trust,” Mr. Dzato further stated.
This comes as the central bank has begun exploring machine learning techniques for inflation modelling and credit risk analysis, while planning to collaborate with academic partners and industry stakeholders on research initiatives.
Dzato explained that the Digital Academy will train bankers to integrate technological innovation with ethical practices and customer inclusion.
The Ghanaian Banker Magazine will serve as a platform for policy dialogue and thought-leadership, supporting the broader objective of professional development within the banking sector as Ghana navigates its economic recovery and transformation agenda, Mr. Dzato added.
