The Kintampo Rural Bank in the Brong Ahafo Region has made a bailout provision of GH¢3.9million for a number of distressed micro businesses in 2016: the initiative is meant to salvage the ‘doom and gloom’ situation for businesses that have lost their savings in the recent infamous collapse of Ponzi schemes and microfinance institutions.

The bail-out package is an about 77 per cent increase over a GH¢2.2million allocation the bank gave to micro businesses in 2015 as loans. The sharp increase of the loan portfolio was necessitated by the magnitude of collapsed businesses within the bank’s operational area, coming in the aftermath of a rancorous investment atmosphere that has jammed the local economy.

Although the bank has over the years enjoyed remarkable recovery rates for such advances, the current gloomy economic situation in the region indicates it should tread cautiously in order not to plunge its investment down the drain. To this end, the bank will back up the bail-out to businesses with comprehensive quarterly financial literacy education to sharpen their knowledge in financial management.

In an interview with B&FT, Martin Mensah, General Manager of Kintampo Rural Bank said: “Drastic times call for drastic measures; smaller businesses have really suffered in this part of the country and require bold banks to offer financial elbow-grease to enable eager-beaver ones to bounce back”.

With micro-businesses and other petty-trading activities serving as the mainstay of the once-agriculture-driven economy in the Kintampo Rural Bank operational enclave, the Manager said the bank has also increased disbursement to petty-trading women groups from GH¢867,000 in 2015 to GH¢1.2million.

For some time now farming activities within the catchment area of the bank have been taking a nosedive. Kintampo and its environs were noted for the cultivation of yam, maize, cashew, cowpea and rice among other crops; but for the last two years many farmers have shunned farming and invested their monies in Ponzi schemes for outrageous interest rates.

Patronage of agricultural loans has therefore reduced drastically within the vicinity. According to Mr. Mensah, in spite of the bank’s willingness to support farmers, very few of them accessed the bank’s facility in 2015 and the sum of loans disbursed to farmers was only GH¢560,000. He indicated that the bank is still open to assist farmers rediscover the fortunes of agriculture, which used to be a major component of economic development within the Kintampo area.

The year 2015, he noted, was very challenging for the banking industry, particularly in the Brong Ahafo Region; but he expressed optimism that things will turn around. The Kintampo Rural Bank mobilised a total deposit of GH¢14million, which was one million short of its target. With the intention of opening two more mobilisation centres, the bank projects to collect about GH¢17.7million as deposits by the close of 2016. This is expected to marginally boost the bank’s profit from GH¢1.3million in 2015 to about GH¢1.4million by the end of December, he added.