The World Bank Board of Executive Directors, have approved $250 million from the International Development Association (IDA) to support the establishment of the Development Bank of Ghana (DBG).
This will increase access to long term finance and boost job creation for 10,000 enterprises in key sectors, including agribusinesses, manufacturing and high value services.
"By offering long-term wholesale financing, credit guarantees, and other services, the Ghana Development Finance project will help increase overall lending to priority sectors and market segments," said Pierre Laporte, World Bank Country Director for Ghana, Sierra Leone and Liberia.
"The project is aligned with government priorities outlined in the Coordinated Programme of Economic and Social Development Policies and is an integral part of the World Bank Group's efforts to promote sustainable growth in Ghana."
The Ghana Development Finance project is expected to increase the number of viable Micro, Small, Medium and Enterprises (MSMEs) with access to long-term financing. It will provide financial services to about 10,000 enterprises, including 2,000 women led MSMEs, and therefore contribute to economic growth and diversification.
The project will also strengthen the oversight of development finance institutions and the adoption of Environmental and Social standards by financial institutions.
"These interventions will include the establishment of a Partial Credit Guarantee facility and a digital financing platform to leverage private sector financing by making it more efficient and less risky for private financiers to lend to MSMEs," said Carlos Vicente, World Bank Senior Financial Sector Economist.
In addition, DBG will finance multiple interventions to attract private sector financing for credit constrained MSMEs and small companies based in Ghana.
The World Bank's International Development Association (IDA), established in 1960, helps the world's poorest countries by providing grants and low to zero-interest loans for projects and programs that boost economic growth, reduce poverty, and improve poor people's lives.
IDA is one of the largest sources of assistance for the world's 76 poorest countries, 39 of which are in Africa.
Source: Joy Business