Ghana’s credit market is showing early signs of relief, but high borrowing costs continue to weigh on businesses and households despite a notable drop in lending rates.
Latest figures from the Bank of Ghana indicate that the average lending rate fell to 19.7 percent in February 2026, down sharply from 30.12 percent a year earlier. While the decline reflects improving macroeconomic conditions, analysts say the pace remains slower than expected.
The easing trend has been gradual over the past year, with lending rates steadily declining from above 29 percent in early 2025 to just under 20 percent. However, the persistence of double-digit rates suggests that access to affordable credit remains limited.
In contrast, key benchmarks have fallen more rapidly. The Ghana Reference Rate dropped significantly to 14.6 percent in February 2026 from nearly 30 percent a year earlier, driven by tighter inflation control and the central bank’s monetary easing stance.
This gap between benchmark rates and actual lending rates highlights weak transmission within the financial system, as commercial banks remain cautious due to risk concerns and operational costs.
The disparity in lending rates across banks further complicates the picture. While some institutions offer relatively lower rates, others continue to charge as high as 28 percent, depending on borrower risk profiles and sector exposure.
For businesses—especially small and medium-sized enterprises—the situation presents mixed prospects. Although borrowing costs are gradually declining, rates remain high enough to discourage expansion and new investment.
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Households face similar constraints, with access to mortgages and personal loans still limited by high repayment costs. Only borrowers with strong credit profiles are likely to benefit from the lower end of the rate spectrum.
Despite these challenges, improving economic indicators—including falling inflation, lower treasury yields and a stable currency—suggest that lending rates could decline further in the coming months.
For now, however, Ghana’s lending environment reflects a transition phase, where macroeconomic gains are yet to fully translate into affordable credit across the economy.