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Independent AfricaDBG partners Proxtera to support SMEs in Ghana with US$100m

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DBG partners Proxtera to support SMEs in Ghana with US$100m

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Small and Medium-sized Enterprises (SMEs) in Ghana’s agriculture, manufacturing, Information, Communications and Technology (ICT), and high-value sectors are set to receive a US$100 million loan through a digital platform.

This initiative stems from a collaboration between the Development Bank Ghana (DBG) and Proxtera, a Singaporean fintech company focused on simplifying cross-border trade and empowering SMEs through digital platforms.

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DBG will extend loans to eligible SMEs for their growth and expansion, facilitated digitally by Proxtera.

The formalization of this partnership took place on the sidelines of the ongoing 3iAfrica Summit in Accra on Tuesday, May 14.

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Mr. Duker emphasized that SMEs must meet specific criteria to qualify for the loan, including being Ghanaian-owned and operating within the country, with a bankable financial plan.

Speaking to the media following the event, Mr. Kwamina Duker, CEO of DBG, highlighted the bank’s commitment to embracing digitization in lending practices to better serve SMEs in today’s era.

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He clarified that while the bank can assess credit portfolios and other requirements for SME loans through traditional channels such as wholesale and rural and community banking, the online platform will streamline and expedite the

“This platform allows that process to be much quicker, and effective, and as a result of that, the risk premium of the interest rate being applied to SMEs, will over time come down,” he said.

“If today, it takes about three to six months to get a loan, with a huge amount of documentation, and we can cut that down to turnaround of literally a real time of 24-hours… then we can appreciate the benefits of digitalisation,” Mr Duker said.

He explained that due to the substantial financing gap for SMEs, no single bank could address it entirely. Therefore, the bank was acting as a catalyst to mitigate risks, enabling other banks to extend affordable loans to SMEs for their operations and job creation for Ghanaian youth.

Mr. Duker highlighted the bank’s success in the rubber sector, which inspired other banks to provide loans to companies in that sector. Similar initiatives were initiated in the rice sector.

He illustrated that in the rice sector, for instance, the bank managed to reduce financing costs by approximately 14% through de-risking and demonstrating positive results, thereby attracting other banks. He emphasized that this is the developmental role of the bank.

Mr. Saurav Bhattacharyya, CEO of Proxtera, announced their intention to develop a credit engine on their technological platform to expedite the evaluation of SMEs for loan disbursement.

He noted that Ghana is the fourth country to benefit from their platform and expressed confidence that it would address the credit access challenges faced by Ghanaian SMEs.

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