By Hamza Adam
Ghana’s 24-Hour Economy is a transformative vision aimed at boosting productivity around the clock, creating decent jobs, and reducing dependence on imports.
The recently launched 24H+ document outlines ambitious strategies to transform agriculture, expand manufacturing, improve logistics, and mobilize capital through FUND24, the program’s financing arm and capital mobilization engine.
What remains uncertain is the source of patient and inclusive capital needed to propel the 24-Hour Economy forward.
Ghana’s financial sector faces structural challenges that limit support for the productive economy. Lending rates for micro, small, and medium-sized enterprises (MSMEs) often range between 29–44% annually, with loan tenors rarely exceeding two years.
Collateral requirements—sometimes twice the loan value—exclude many entrepreneurs from accessing credit. This persistent difficulty in obtaining credit continues to constrain MSMEs, despite their central role as the backbone of Ghana’s economy.
Agriculture, which employs nearly 40% of Ghanaians, receives less than 5% of commercial bank lending. Such imbalances will hinder the full realization of a 24-hour economy.
FUND24, the program’s financing arm, aims to mobilize $4 billion through blended finance and value chain facilities. While significant, Ghana needs more than conventional solutions. What is urgently required is patient, affordable capital that aligns with the pace of value chains rather than constraining them—and this is where Islamic Banking and Finance can fill the gap.
A Better Fit for Ghana’s Productive Sectors
Unlike conventional banking, which is largely interest-driven, Islamic finance is based on risk-sharing, asset backing, and ethical investment. Instead of relying on high collateral and short-term repayment, it employs instruments such as Mudarabah (profit-sharing), Musharakah (equity partnership), Murabaha (cost-plus trade finance), and Ijara (leasing). These models align well with Ghana’s goal to develop value chains under the 24-Hour Economy, offering long-term and flexible capital to support agriculture, manufacturing, and logistics.
Powering Infrastructure and Energy Expansion
A reliable power supply, efficient transportation systems, and strong digital networks are the backbone of any successful 24-hour economy. Again, Islamic finance provides proven tools: Sukuk, or Islamic bonds. Unlike conventional bonds, sukuk represent ownership in real assets and generate returns based on their performance.
Countries such as Nigeria, Indonesia, and Malaysia have successfully used sukuk to finance schools, roads, power plants, and airports. Other nations like the UK, Luxembourg, Singapore, South Africa, and Hong Kong primarily issue sukuk to diversify funding sources and tap into deep pools of Islamic finance liquidity. For Ghana, sukuk could be especially valuable for financing infrastructure and value chain projects under FUND24—such as industrial parks, agro-processing hubs, transport corridors, and renewable energy—providing long-term funding that directly supports the productive sectors of the 24-Hour Economy.
Inclusive Capital for MSMEs and Agriculture
Islamic finance can help lower high borrowing costs for small businesses and farmers. Tools like Salam provide farmers with funding before harvest, and Ijara allows factories to lease equipment instead of taking on heavy debt. Repayments follow actual production cycles. By reducing collateral demands, these models make credit more accessible to women, youth, and informal enterprises, which are often left out of traditional banking.
Attracting global capital
Islamic finance opens Ghana to vast pools of untapped international investments. Globally, assets exceed $3 trillion, and this market appeals not only to Islamic investors but also to ethical and impact-focused funds that prioritize transparency, asset backing, and risk-sharing. Incorporating Islamic finance into FUND24 can help Ghana diversify its capital base, enhance its reputation as an innovative investment hub, and establish direct links to financial centers in Asia, the Middle East, and Europe—securing funds that conventional instruments might not attract.
What must be done
The Bank of Ghana is expected to finish its stakeholder consultations and finalize regulatory and supervisory frameworks by year’s end, paving the way for implementing non-interest banking provisions under Act 930. Once established, these frameworks should support all FUND24 initiatives—covering MSMEs, value chains, and infrastructure. Successfully integrating Islamic finance across FUND24 could unlock the patient, inclusive capital needed to drive Ghana’s 24-Hour Economy.
Conclusion
The 24-Hour Economy offers Ghana a unique opportunity to industrialize and generate substantial employment. Achieving this vision hinges on inclusive, affordable financing. Islamic Banking and Finance provides exactly that—patient, ethical, and partnership-based capital. Far from being just an alternative, it is the missing link capable of helping the 24-Hour Economy fulfill its potential for the benefit of all Ghanaians.
The writer is a seasoned banker with extensive experience in conventional banking and specialized expertise in Islamic finance. He is an Associate of the Chartered Institute of Bankers, Ghana, and holds a PGD in Islamic Finance from the Geneva School of Business and Economics. He can be reached at hamzaa10@yahoo.com
Provided by SyndiGate Media Inc. (Syndigate.info).
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