Some members of the committee in a group photograph
The Chief Executive Officer of the Ghana Enterprises Agency (GEA), Kosi Yankey-Ayeh, on Thursday inaugurated a technical committee to assist the agency devise innovative ways of improving access to finance for young entrepreneurs.
The committee, which comprises of representatives from some stakeholder groups within the Micro, Small and Medium Enterprises (MSME) sector, has a one-year renewable mandate of providing guidance and support to the Financial Service Department (FSD) of the GEA, as it implements access to finance related interventions.
Tasks of the committee include providing inputs for the creation and implementation of the MSME Fund, identifying partner institutions for access to finance initiatives, providing inputs that will help expand GEA’s funding portfolio and global reach, and also providing inputs into national policies related to MSMEs access to finance.
Stakeholder representations on the committee included MSME association members, GEA, Ministry of Finance, Ministry of Trade and Industry and financial institutions.
Speaking at the first meeting of the committee, the CEO said the setting up of the committee was based on research findings that had identified the lack of access to finance and information as the main challenges confronting the MSME sector.
These were attributable to the perceived risks from low financial management skills among entrepreneurs, lack of proper documentation to support loan applications and the funder focus on agro-based business lines.
High interest rates which tend to erode profits and, in some cases, make debts unpayable, was also identified as the bane of the few Ghanaian MSMEs who access funding.
“What we realised was that, a lot of our clientele in Ghana for lack of information did not know how to access information and so two years ago we undertook a study and we realised the problems of lack of information and not even knowing how to approach some of these financial institutions,” she said.
In rising up to the challenge, the GEA, she said, decided to set up the committee to look into designing interventions that would be implemented by the FSD to solve problems of financial inclusion, financial literacy and access to finance as a whole.
She added that “our current strategic plan from 2021 to 2025 has a view of building a resilient and competitive MSME and wants to set up an FSD to develop strategy to address challenges for access to finance for MSMEs.”
The facilitation of access to finance, she said, was a component of the agency’s mandate which has seen the setting up of the MSME Fund.
She, therefore, disclosed that two policy documents which are the innovative financial product and financial directory have been developed to assist MSMEs gain more insight into funding.
She also reiterated that activities undertaken by the Ministry of Finance and the Ministry of Trade to promote financial inclusion and to build the resilience of MSMEs, respectively, would not materialise without interventions to address issues relating to access to finance.
By Issah Mohammed