Total value of secured loans extended and registered by banks and Specialized Deposit-Taking Institutions (SDIs) in the third quarter of 2023 according to the November 2023 Economic Analysis Report by CedisPay, witnessed a substantial decrease, amounting to GHS 5.5 billion.
This marks a significant 32.7% drop from the GHS 8.1 billion reported in the corresponding quarter of 2022. The downturn is particularly pronounced in the banking sector, with secured loans contracting by 40.8%, falling from GHS 7.3 billion in Q3 2022 to GHS 4.3 billion in Q3 2023.
In contrast, SDIs experienced a noteworthy uptick, recording GHS 1.2 billion in secured loans—a robust 36.4% increase from the previous year.
Delving into the lending rates terrain, the report provides insights into the nuanced dynamics across various financial institutions. Banks showcased the lowest average lending rate for all secured loans in Q3 2023, standing at 26.5%. This compares with the 20% lending rate in Q3 2022 and 26.9% recorded in Q2 2023.Leasing Companies observed a contrasting trend, witnessing an upswing in their average lending rate to 28.1% in Q3 2023 from 17.4% in Q3 2022. Finance and Leasing Companies also registered an increase, with the average lending rate climbing to 30.5% in Q3 2023 from 29.6% in the corresponding period last year.
Regional Rural Banks (RCBs) also experienced a rise in the average lending rate on secured loans, reaching 35.3% in Q3 2023, up from 33.2% in Q3 2022. Micro Credit Companies, however, exhibited a significant reduction in their average lending rate, dropping to 41.5% in Q3 2023 from 56.7% in the corresponding quarter of 2022.
