Eximguaranty ready to support banks to lend to SMEs

Accra, May 15, GNA - Eximguaranty Ghana Limited says it is ready to support banks and other financial institutions to deliver long-term credit to small-and medium-scale enterprises.

In this direction, the company is to launch two new major products on export proceeds insurance and credit guarantee for foreign credit lines to boost support for Ghanaian companies. Eximguaranty was established by the Bank of Ghana in 1995 to share credit risks and provide incentives to banks to increase lending to local firms engaged in domestic production and exports. From its inception 13 years ago, the institution has approved 1,602 projects valued at GH¢52.7 million.

Speaking at a workshop for legal and credit risk managers drawn from banks, leasing and financial institutions to discuss ways of enhancing access to credit for small and medium businesses, Mrs. Felicity Acquah, Managing Director of Eximguaranty, said the time had come for the old products to be seriously reviewed while news ones were introduced in line with changing global trends.

The workshop aims to enhance the existing relationships with clientele banks and other financial institutions and to also seek their views regarding the conditions guiding the guarantee scheme. Mrs. Acquah said the company was positioning itself to support the banks to use credit guarantees to expand access to working capital and loans to productive and export business ventures.

Eximguaranty provides general credit guarantee up to a maximum of 75 per cent. The guarantees are meant to provide a cushion to financial institutions in times of business failure and credit default. Mrs. Acquah said export traders dealing in Made in Ghana goods were eligible for the company's guarantee for working capital, packaging and shipment purposes.

Credit guarantee cover exists for SMEs with asset size of between $100,000 to two million dollars. "The aim of our support is to encourage the banks to lend for longer term instead of short term across the economy to the manufacturing, agriculture and other productive sectors," she said. Mr. Nathan Kwaffo, Head of Operations Eximguaranty, encouraged the banks to submit applications to access the guarantee to support their clients.