AGI pushes BoG to overhaul loan moratorium rules to match business cycles

Ghana's Association of Industries is demanding that the Bank of Ghana and government rethink how loan moratoriums are structured, arguing that current repayment schedules fail to account for the vastly different cash-flow realities of manufacturers, agribusinesses, and retail traders.

William Agyei Manu, chairman of the AGI's Agribusiness Sector, made the plea during a Bank of Ghana Collateral Registry sensitisation programme on the Borrowers and Lenders Act in Kumasi, highlighting a long-standing friction between lenders and borrowers over payment terms that do not reflect operational realities.

The core problem: one-size-fits-all loan structures

The challenge, according to Manu, is straightforward but systemic. A retailer buying and selling daily needs very different repayment terms from a manufacturer who must import equipment, spend months installing it, and wait several more months to begin generating revenue. Yet banks apply similar moratorium periods across sectors.

"If you take the retail banking, for instance, somebody who is doing a buy and sell on a daily basis, his issue will be different from me as a manufacturer who would have to maybe procure equipment from India or China or Germany and have to set it in six months' time and begin production in seven or eight months' time," Manu explained.

The problem extends beyond traditional banks. Development finance institutions such as the Ghana EXIM Bank are also locked into rigid repayment frameworks that penalise businesses whose revenue cycles take longer to mature.

Why it matters for Ghana

The stakes are high for Ghana's economic stability. When loan terms do not align with business realities, companies cannot meet repayment obligations despite generating genuine revenue. This directly drives up non-performing loans (NPLs)—a long-standing drag on Ghana's banking sector and a key constraint on credit availability.

Access to credit remains one of Ghana's most urgent private sector challenges. The AGI's own Business Barometer reports consistently identify financing and energy as the top obstacles facing businesses. Yet the current system makes accessing credit even harder because borrowers cannot secure terms matching their operational reality, and lenders become hesitant to fund ventures they believe are high-risk based on inflexible repayment schedules.

For Ghana's agribusiness sector—a priority growth area—the problem is especially acute. Agricultural production has hard biological and seasonal constraints. You cannot force a cocoa or maize farmer to generate revenue before harvest. Current loan structures, however, often ignore this reality.

What happens next

The AGI is advocating for moratorium rules to be codified in law based on sector-specific characteristics, rather than left to subjective negotiation between lenders and borrowers—where borrowers often lack leverage.

"I'm not saying it should be a subjective convenient time, but it should be a matter of law," Manu said, signalling frustration with informal arrangements that typically favour banks.

Encouraging news came from the Bank of Ghana, which has pledged to consider the AGI's concerns in a forthcoming amendment to the Borrowers and Lenders Act 2020. The current law (Act 1052) does allow borrowers and lenders to agree on repayment terms, but the AGI argues this flexibility has not translated into fair practice.

The proposed amendments offer a window to embed sector-informed moratorium rules into Ghana's lending framework. For manufacturers, agribusinesses, and exporters, this could mean the difference between securing financing and being priced out of credit markets entirely.