The Peasant Farmers Association of Ghana says it is disappointed that the yet to be established Development Bank Ghana will not deal directly with farmers.
The bank is a major part of the GHS100 billion Ghana CARES ‘Obaatampa’ programme aimed at dealing with the devastating economic effects of the COVID-19 pandemic.
Head of Programmes and Advocacy of the Peasant Farmers Association of Ghana, Charles Nyaaba said his members hoped to do business directly with the bank as they presently face challenges dealing with the various banks.
“If you say the development bank is to help agribusiness activities and that is going to be advancing credit facilities to commercial banks, I think that is something we are sceptical about. We are sceptical about its benefits to the direct people who are in the agricultural value chain.”
The Ministry of Finance and the European Investment Bank recently signed an agreement for the provision of a €170 million facility for the establishment of the Development Bank Ghana (DBG)
When the bank commences operations in July, the bank will focus on agriculture, affordable housing, ICT, among other areas.
Finance Minister, Ken Ofori Atta, had stated that the DBG will neither give retail nor direct business loans but will rather provide funds to the existing commercial banks and other qualifying financial institutions to provide long-term lending and other innovative products that are presently lacking in the system.
Financing has been a major challenge for many in the agricultural space as financial institutions have consistently shied away from that sector due to the risk elements and uncertainties associated with the same.