The National Investment Bank (NIB) has said it is placing greater focus on small and medium-scale enterprises (SMEs) to enable them to play a more meaningful role within the economy.
As a result, the bank is processing loan facility forms put forward by players in the sector within 24 hours to enable them to access quick funds to boost their businesses.
The Managing Director (MD) of the bank, Mr Ernest Mawuli Agbesi, announced this in Accra when the bank hosted editors of some selected media institutions in Accra.
The meeting offered the platform for the management of the bank to interact with the editors and share its mission and vision and core values.
“Once they approach us with the right documentation and relevant documents to access funds to boost their business operations, we will process their applications within 24 hours”, he said.
Access to loans has been one of the major banes of SMEs across the country partly because of the lack of trust in their ability to pay back.
It is also due to the lack of authentic address systems; and improper bookkeeping practices to prevent misuse of the funds raised from the banks.
As a result, many SMEs which are considered the engine of growth are struggling to survive.
However, Mr Agbesi reiterated that much as it was risky to lend to the SMEs, the bank had put in place adequate measures to ensure that the funds released to them were paid back.
“We have put in place a vibrant risk management department with the right staff and the right competences to ensure that the depositors’ money we give as loans are well protected”, he said.
Mr Agbesi said the bank had embarked on an exercise to retrieve all outstanding debts owed it by its customers.
“Loans that are long overdue are being recovered because we have warned those who owe us that we are not relenting on our efforts to recover the monies”, he said.
In the last couple of months, the bank has been publishing the names and faces of debtors in the national dailies; a move the MD claims has helped recover some of the money.
Much as bad debts are inevitable in the banking sector, the level of abuse of the system is one of the reasons banks in the country shy away from supporting the private sector with loans for them to grow their business.
According to the February report of the Monetary Policy Committee of the Bank of Ghana, the non-performing loans (NPL) ratio of the banking system, adjusted for fully provisioned loans, increased to 5.6 per cent at the end of December 2014 compared with 4.6 per cent in the corresponding period in 2013.
However, the unadjusted NPL ratio declined to 11.3 per cent from 12 per cent in 2013.
Against this background, Mr Agbesi promised to ensure that “a substantial chunk of monies owned the bank will be retrieved. There are anonymous people threatening my life but I will not give up that fight because I want to protect depositors’ funds and the shareholders’ interest.”
He said since the campaign began, about Gh¢5,5 million had been retrieved with more making commitments to arrange a repayment plan.