Interest rate is the amount of dividend due per period, as a proportion of the amount lent, deposited, or borrowed (called the principal sum). The total interest on an amount lent or borrowed depends on the principal sum, the interest rate, the compounding frequency, and the length of time over which it is lent, deposited, or borrowed.
In this write-up, I will be discussing with you the current rate on loans in Ghana. When you take a loan from any financial institution there is an amount or percentage you will pay with the main amount you got from the bank that is the interest. For instance you took a loan of GHS 100.00 from a lender which could be bank or any other institution and you are to pay GHS 110.00 at the end of the tenor then the GHs 10.00 on the GHs 100.00 which was given to you becomes the interest.
CURRENT INTEREST RATE ON LOANS IN GHANA
The central bank of Ghana increased its key prime interest rate by 250bps to 17% on March 21st 2022. Ghana’s average lending rate reaches 22.38%, lowest in about 12yrs. Ghana recorded an average lending rate of 22.38% in April 2020. According to the Summary of Economic and Financial Data by the Bank of Ghana (BoG), this is the lowest in over 12 years.
It is the biggest increase in borrowing costs in more than 20 years, citing uncertainty surrounding price development and its impact on economic activity. The bank’s governor, Ernest Addison, said during a news conference that “the risks to inflation are on the upside”. Annual inflation rate in Ghana accelerated for the ninth consecutive month to 15.7% in February, the highest rate since October of 2016.
SOME BANKS AND THEIR INTEREST RATE
- Agricultural Development Bank. The majority of the shares (52%) of this bank are owned by the government. It was established in 1965 and has grown to have 78 branches in Ghana today. The current interest rate is 27.60%.
- Barclays Bank of Ghana. This is one of the oldest and largest banks in Ghana. It has several branches in different parts of Ghana and has an interest rate of 21.55%.
- CAL Bank. This bank was established in 1990. Though it has been around for a short while, it has grown in leaps and bounds. It has a reputation as the most invitational bank in the country and has an interest rate of 28.50%.
- Fidelity Bank. This bank is among the most recently established foreign investors own it. A couple of Ghanaian stakeholders have also invested in the bank including SSNIT. The current interest rate lies at 30.50%.
- The Ghana Commercial Bank. This is the biggest indigenous bank in the country as it has the highest number of branches and ATMs scattered around Ghana. The bank’s interest rates sit at 25.05%.
- International Commercial Bank of Ghana. This bank is an offshoot of the renowned ICB banking group which has its base in Switzerland. The bank has an interest rate of 22.95%.
- National Investment Bank. This bank provides a dual-range of services. Firstly, it is a commercial bank before acting as a development bank. The bank’s interest rate lies at 27.33%.
- Prudential Bank. This bank was established in 1993 and has grown very fast to having several branches in different parts of the country. It has a 27.50% interest rate.
- Energy Bank Ghana. This is one of the youngest banks in Ghana as it was started in 2011. The bank has a current interest rate of 24.88%.
- Standard Chartered Bank Ghana. This bank is a subsidiary of the UK-based Standard Chartered PLC. The bank has been in operation for over a century and it has an interest rate of 23.56%.
- Stanbic Bank of Ghana. This bank is highly reputed for its efficient services. The current interest rate is 28.50%.
- Bank of Africa. This bank provides a series of services including SME and Corporate Banking. The interest rate stands at 27.15%.
- Bank of Baroda Ghana. This bank is an offshoot of an Indian bank which is one of the largest in India. The bank hit the Ghanaian shores in 2008 and has a current interest rate of 15.16%.
- SG-SSB Limited. Societe Generale is one of the largest banks in Ghana and the current interest rate stands at 22.45%.
- Guaranty Trust Bank. This bank spread to Ghana in 1991 and has grown to be among the few banks to have a triple-A rating in the country. The current interest rate is 26.75%.