The Deputy Minister of Finance and Economic Planning, Prof Gyan Baffour has appealed to financial services to find ways of monitoring beneficiaries of loans, rather than demanding collateral from them.
He noted that some Small and Medium Enterprises (SMEs) have good intentions of business but because they do not have collateral they are unable to secure loans from financial institutions.
Speaking at the launch of TF Financial Services Limited, yesterday, Prof Gyan Baffour intimated that small enterprises through innovative credit practices which would ensure that profit success was based on monitoring and counselling, rather than demanding for collateral.
He commended the Ghana National Association of Teachers (GNAT) for instituting the Teachers Fund about 10years ago and coming up with the TF Financial Service which is focused on the provision of affordable loans to salaried workers and SMEs.
He observed that at the time of independence, the banking industry was made up of only three banks, but now the number had grown to over 25 with a network of over 700 branches, 114 Savings and loan companies, 25 Insurance companies and finance houses.
The Deputy Minister indicated that the influx witnessed in the financial services was in the direction of achieving the goals and objective of NEPAD.
“The government's vision of promoting the private sector as engine of growth cannot be fulfilled without the effective functioning of financial intermediaries such as banks, finance houses and other financial institutions,” he stressed.
He bemoaned that with the high numbers of financial services in the country the cost of doing business was still high, thereby posing a risk to new businesses and urging them to reduce their lending rates.
Outlining the vision of the financial service, the Board Chairman of TF Financial Services Limited, Mr. Frederick France stated that they would offer advances to both individuals and SMEs.
He assured that they would guarantee unmatched and unrivalled performance, adding that they had already employed 40 people in Accra, and plan to create more jobs over the next three years.