Governor of the Bank of Ghana, Dr Ernest Addison, in June 2021 warned serial debtors to stop excessive borrowing.

He said it is about time perpetrators stop this attitude so banks can also invest in the private sector.

Read the full story originally published on June 2, 2021 by www.ghanaweb.com.

• Many businesses borrow from the banks and do not pay back

• It is for this reason that the Bank of Ghana Governor has asked these serial borrowers to refrain from such act

• Dr Ernest Addison charged the court to be proactive

The Bank of Ghana (BoG) Governor, Dr Ernest Addison, has issued a stern warning to serial borrowers who don't settle their debts.

According to him, it is about time perpetrators especially businesses stop excessive borrowing so the banks can also invest in the private sector.

The uncalled for attitudes exhibited by these serial borrowers affect the decision of bank owners when it comes to lending.

"We are concerned that the banks are not investing in the private sector. Why they are not lending and properly intermediating and then, on the other hand, we are also concerned about the MPLs in the economy and this is really why the banks are being risk-averse into the private sector. If you look at the list of high classified loans and you see the type of enterprises that are in there, we have a problem. These are firms that we know but it appears that they have loans that are not performing and some of them have become serial borrowers and they do not service their debts. I think that culture has to be changed."

"People who borrow and think they cannot pay and when you do that, you create these types of difficulties and then we get up and say the banks are not lending. Why will they lend when they are only going to be throwing customer deposits after bad risks?" he quizzed.

Dr Addison said the Ghanaian environment does not help financial institutions to lend to the private sector.

"Unfortunately, our judicial system is not helping and they try to enforce the collateral in these cases, adjournment after adjournment. The environment doesn't help in lending to the private sector."

But he said the central bank has instruments at its disposal to compel the private sector to lend but is cautious to do so.

He made these statements at the 100th Monetary Policy press conference held in Accra Monday.