The Ghana Stock Exchange (GSE) and Venture Capital Trust Fund on Tuesday signed a Memorandum of Understanding (MoU) to promote the listing of small and medium scale enterprises on the Exchange.

Mr Kofi Yamoah, Managing Director of GSE and Mr Daniel Duku, CEO of VCTF signed the MoU that would enable the two institutions collaborate with other stakeholders to develop alternative market for SMEs.

The MoU would ensure that they jointly lead the SMEs listing project, coordinate with other stakeholders, facilitate the underwriting and provide upfront funding for SMEs desirous to list and hold public fora and education for SMEs and the public.

“The MoU is about Ghana. There are many SMEs and with the right growth strategy can help accelerate the pace of development,” Mr Yamoah said at the signing ceremony.

He said the Venture Fund Investment in SMEs and the partnership with the Exchange was a clear indication of support for SMEs.

Mr Duku said the relationship with the Exchange in the alternative SMEs market would provide good exit strategies for venture capital finance companies and SME investors.

“We are coming on board as great partners in the Alternative SMEs market,” he said, adding that the company was putting into the revolving fund $500,000 to support the scheme.

He said the Exchange is setting up a revolving fund to pay for the listing expenses such as underwriting and legal fees of the companies adding that an agreement to that effect has been signed with Accra-based Fidelity Capital Partners, to pool resources for the fund and discussions are on-going with the African Development Bank and other development partners to contribute to the fund.

Mr Ekow Afedzie, Deputy Managing Director of GSE, said the Exchange would contribute to the fund and was working to get other institutions to do the same.

He said the revolving fund when operational would provide resources to have listing expenses paid ahead of actual public floatation.

He said the GSE plans to launch in the second half of the year an alternative stock market with focus on SMEs, which might want to raise capital but are unable to meet the stringent requirements of the bourse.

Mr Afedzie said this plan is part of efforts by the GSE to encourage listings and improve liquidity on the bourse while giving SMEs the opportunity to raise capital from the bourse.

Details of the proposed Ghana Alternative Market are with the Securities and Exchange Commission for approval.**