A recent report by the Bank of Ghana reveals a significant shift in the country’s financial landscape, with domestically-owned banks steadily gaining ground over their foreign counterparts in secured loan disbursements.
According to the latest Collateral Registry Quarterly Brief for Q4 2024, the share of secured loans issued by foreign-owned banks plunged from 74.6% in the previous year to 51.5% this quarter. In stark contrast, locally-owned banks almost doubled their share, moving from 25.4% to 48.5%.
This reversal suggests that local banks are not just keeping pace with, but actively challenging, the long-standing dominance of foreign institutions. Analysts speculate that the rise in local bank disbursements could be attributed to their increasingly competitive lending terms, personalized customer service, and solutions tailored to the needs of Ghanaian businesses and individuals. As consumers become more confident in the local banking system, there is growing hope that this trend will continue, potentially reducing the financial sector’s vulnerability to external economic shocks.
The implications of this shift extend beyond mere market share. If local banks solidify their position, Ghana’s financial system could benefit from enhanced resilience and improved credit accessibility. Greater competition is likely to spur innovation within the sector, which could translate to lower interest rates and more customer-focused services—a win-win scenario for borrowers and the broader economy alike.
While foreign banks still command a larger portion of the market, their diminishing influence is a clear signal that the era of local banking empowerment is well underway. As the debate unfolds, the focus remains on understanding the drivers behind this trend and whether it represents a temporary fluctuation or a long-term transformation in Ghana’s financial sector.
