According to Vice President Bawumia, the government is attempting to create a credit system in Ghana that uses credit scoring provided by credit reference agencies.
The Vice President said that crucial pillars like the Ghana Card, which offers a distinct identity and vital details about the bearer, such as bank accounts, sim cards, SSNIT, NHIS, and many more, and the National Digital Property Address System, which gives the borrower a specific location, have already been put in place and that the other pillars should follow very soon to enable credit scoring.
An independent company called a credit reference agency securely stores data, such as a person's credit applications, accounts, and financial behaviour. This information is then used to create a credit score, which basically expresses one's creditworthiness and aids in deciding how much, if any, premium should be applied to any loan or hire-purchase application.
On Friday, July 15, 2022, Dr. Bawumia said at the opening ceremony of the 18th Biennial Connexional Youth and Students Assembly (YASA) of the Methodist Church of Ghana in Nyanyano in the Central Region that systems in place to make life simpler and easier are what give some nations the appearance of being more developed. The Akufo-Addo administration has since its inception worked hard, leveraging technology, to incorporate digitization into daily life.
"We are transforming the system and the economy. Because they have functional institutions and systems, industrialised nations are where things seem to work. All continents have the same human characteristics, but they also have functional systems, and it is these systems that we are implementing in Ghana. procedures that will ensure that you cannot hide, commit a crime, or fail to repay a debt without being discovered.
"The system we are putting in place in Ghana is highly transparent, open, it will lessen corruption, improve the effectiveness of the delivery of public services, it will cut the cost of doing business, and it will lessen bureaucracy," he said."More significantly, Ghana is getting a credit system built. Credit reference companies will be allowed to conduct credit scoring in Ghana for the first time in our history by the end of this year since we have connected all of our bank accounts to the Ghana Card, our country's official ID number. In our history, this would be the first instance.
"Credit scoring would make it possible for each person to have a distinct credit score. With your national ID, you will be able to check your credit rating. Your credit score will be very low if you have a history of not repaying debts, and banks won't lend to you. If you are a good payer, your credit score will be excellent.
The banks will lend you money, and you'll pay a cheaper interest rate," he said.
"We are creating this economy, this new system that will benefit everyone since the previous one lacked openness, but the entire society paid a price for it. For instance, our interest rates are exorbitant.
But thanks to digitalization, the required processes are already in place, enabling tertiary students to get loans without guarantors. According to your credit score, you may soon be able to acquire a low-cost loan, purchase necessary products like refrigerators, vehicles, and other household accessories on credit, and even obtain mortgages, he advised the young man.