Exporters unhappy with banks disbursing EDAIF facility

Story: Ama Amankwah Baafi

EXPORTERS in the country are unhappy with the Enterprise Development and Agricultural Investment Fund (EDAIF) for entrusting its credit facility to banks to disburse to them and other interested institutions.

They said such an arrangement caused delays and increased the cost of the facility to their beneficiaries.

The exporters raised the issue at the 73rd national exporters’ forum in Accra yesterday. It was organised by the Ghana Export Promotion Authority (GEPA), in collaboration with EDAIF, on the theme: “Enhancing Performance of the Export Sector for Economic Development.”

The exporters also wondered why the designated banks and other non-bank financial institutions were lending EDAIF’s credit to them at 12 per cent as against the fund’s 1.2 per cent rate.

The exporters said some of the banks intentionally delayed their applications for credit from EDAIF.

Reacting to their concerns, a Manager at the Export Development Programmes Directorate at EDAIF, Mr Frank Obeng, said the fund as a public sector organisation had no choice than to advance credit to the businesses, especially those that needed it most.

“We at EDAIF do not have the capacity to lend credit and recover. We pass it through the banks and that it is because, experiences have showed that most people hardly pay back their loans,” he explained.

He admitted that there were challenges but said the management and board of the fund were working to address them.

He urged the exporters and other beneficiaries of the fund’s credit facility to remain calm while those challenges were sorted out.

The Deputy Minister of Trade and Industry, Dr Joseph S. Annan, acknowledged the concerns of the exporters and promised to look into it.

“It is not encouraging that government makes efforts to find funds only for it to go through so many hooks. That can defeat the objectives of the entire thing,” he said.

The EDAIF was set up to provide financial support to businesses as part of measures aimed at boosting exports. The fund currently disbusrses facilities to businesses in two forms; in grants and credit component.

Unlike the credit facility which supports businesses to expand their operations, the grant is aimed at boosting the infrastructure network of businesses.