In a bid to support the development of a fair and accessible credit market, the Bank of Ghana has asked lenders [banks and other financial institutions] to capture their rights of enforcement in their credit and collateral agreements.
The directive, which is also aimed at improving disclosure during the lending process, follows the Bank of Ghana’s observation about borrowers’ lack of knowledge about rights of enforcement under the Borrowers and Lenders Act 2020.
Act 1052 makes provisions for the rights and obligations of borrowers and lenders.
According to Section 61 of Act 1052: A lender may sue the borrower on any covenant to perform under the credit agreement.
Where a security interest is registered under Act 1052, a lender may realise the interest in the collateral without initiating proceedings in court.
A lender may appoint a Receiver or Manager to realise the security interest on behalf of the lender.
Specifically, Section 59-75 enumerates the process for the repayment and recovery of debts.
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