BoG reforms target foreign exchange stability to boost SME

The Bank of Ghana says its new foreign exchange reforms are designed to target and stabilise the cedi and boost SMEs predictability in pricing and investment decisions.

He said the reforms will enable SMEs to stay competitive in Ghana’s economic environment.

“For SMEs importing machinery, exporting goods, or planning investments, FX stability and transparency shape pricing, determine competitiveness, and often decide whether a business survives,” Governor Dr. Johnson P. Asiama told bankers and policymakers at a workshop in Accra.

He said the reforms were meant to end speculation and restore confidence.

“By enhancing interbank trading, enforcing reporting requirements, and improving transparency, we aim to ensure that exchange rates reflect real supply and demand. For SMEs, this means less volatility and greater confidence.”

Dr. Asiama also cited new rules targeting large cash withdrawals and over-the-counter deals.

“Our updated guidelines are shifting flows into formal channels. This protects the market’s integrity and ensures FX is available for genuine trade and productive uses,” he explained.

As of early September 2025, 1 U.S. dollar trades for about GH¢12.20. That marks a slide from value levels earlier in the year.

Business and Foreign Exchange market analysts warn that the cedi may weaken further due to persistent strong demand for foreign currency by corporates, limited supply in the FX market, and low levels of intervention by the Bank of Ghana

Meanwhile, Ghana’s external reserves improved in 2025, strengthening the cedi. But SMEs, especially in export and import sectors, have long complained of unpredictable exchange rates hurting competitiveness.

He stressed that Ghana must adopt risk-sharing mechanisms to free up affordable credit.

“In Rwanda, well-governed partial credit guarantees unlocked SME lending and drove job creation. In Ghana, tools like GIRSAL must be more actively deployed, with stronger transparency and governance to build lender confidence.”

Beyond credit, he urged banks to serve as partners in building SME capacity. “Many SMEs struggle to meet export or sustainability standards. Banks can bundle financing with advisory services, supporting clients in certification, traceability, and carbon reporting,” he added.

READ: Abandon collateral-only lending to unlock SME growth -Banks told

SMEs account for about 90 percent of Ghanaian businesses but remain underrepresented in exports.

The World Bank and IFC estimate a global SME financing gap of $8 trillion.