The slow-motion killer in the banking system

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• KWAME OPPONG 6 years ago

  I have never taken any loan from any bank in my life, whether here in Ghana or during my almost decade stay abroad in Europe; even though I must admit, I did go in for an overdraft as a student and the bank recovered my overd ...
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  I have never taken any loan from any bank in my life, whether here in Ghana or during my almost decade stay abroad in Europe; even though I must admit, I did go in for an overdraft as a student and the bank recovered my overdrawals into minuses when my half-scholarship hit my account. Someone will argue with me that, then I took a loan. But for me, it is not the same. at present, I am the owner and head of a company employing a number of people and however never got a loan in setting it up, nor during its growth over the past 8 years, since its establishment. One reason for not getting a loan was inability to fulfill some of the requirements, e.g. collateral and in the beginning insufficient turnover (revenue) to even pass it through the account. It has been hand to mouth even till date even though a little more cash investment could have worked wonders and made a change. So after trying to get a loan at some period and seeing how difficult it would be, and with the horrendous interest rates, I just gave up. Another big contributor to NPLs is the Government itself, as in my line of business, I work for even big companies which in turn have contracts from the Government. Of course, the government delays in paying such companies who in turn delay in paying companies as mine. Just imagine that I had taken a loan and have month's long, almost a year's delay in receiving payments. I would have defaulted in my bank loan and that is what is happening to many road and other contractors who in the Kuffour, Mills, Mahama regime and certainly before then suffer great delays in payments from the Government and a default on their loans, court proceedings, seizure and auctioning for non-payment and even death from frustration. At the moment, IMANI has released a report on the state of the economy and a portion caught my attention, that is expenditure by the Government is down by 14% or so. That could be termed prudent management, but this was also against tax revenues down by some percentages. The downside of expenditure being down is that, my company too may not get paid by that big company which is awaiting payment by the government. Que faire?

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• Winners 6 years ago

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