Financial regulation in Ghana: Balancing inclusive growth with financial stability

Working and discussion papers
November 2014
Charles Ackah and Johnson P. Asiamah
Following the financial crisis, many countries are beginning to prioritise financial stability through regulation, and seeking to balance such policy priorities with the promotion of inclusive growth, especially in poor countries. Sustained financial sector restructuring and transformation in Ghana has succeeded in creating one of the most vibrant financial services centers in the sub region. Ghana has therefore seen a significant increase in the number of banks, including pan-African groups, with a rapidly expanding deposit base. Currently, Ghana is home to 27 banks, of which 15 are foreign owned and six are African banks. However, a number of cross-cutting challenges remain, including access to credit by the private sector and the high cost of credit, which tends to militate against small-scale businesses. While the authorities have continued to work on these challenges, current macroeconomic challenges continue to hamper efforts to lower the cost of credit and to expand access to credit for most small-scale businesses.