Ghana Incentive-based Risk Sharing System for Agricultural Lending (GIRSAL) Programme

In the wake of global efforts to improve financing for agriculture, the Bank of Ghana in collaboration with the Ministry of Food and Agriculture, and the Alliance for Green Revolution in Africa – AGRA is designing the Ghana Incentive-based Risk Sharing System for Agricultural Lending (GIRSAL) programme. The goal of this instrument is to reduce the perceived risk of agriculture financing and to crowd in private finance to support smallholder farmers across the country.

Food affordability and achieving a stable currency is at the heart of the central bank’s risk guarantee programme.

The GIRSAL instrument has six major pillars which are; risk sharing, digital finance, insurance, technical assistance, bank incentive mechanisms and a bank rating scheme. In all these, the Central bank may provide 75% risk guarantee to commercial banks which lend to smallholder farmers in Ghana. Also, the digital finance aspect is intended to serve farmers in rural communities where banking services are not available. Every farmer under the instrument is required to subscribe to agricultural insurance as a way to reduce investment risk and boost investor confidence.

The Ghana Commodity Exchange (GCX) will supplement the GIRSAL initiative to make financing affordable and accessible to farmers. The GCX which is scheduled to commence operations in 2017 has the objective of creating a market platform for agricultural products as a way to improve agricultural value chain and to guarantee better prices for smallholder products.  The GCX’s warehousing system will guarantee financial assistance for smallholder farmers who ordinarily will sell their products at ridiculously low prices in the market. The GCX initiative is already a public-private financing arrangement.


It is expected that the design of the project will be completed by January 2017. GIRSAL  will become functional by the end of the first quarter of 2017 as a company limited by liability —GIRSAL Plc Ltd., while project implementation will begin by the second quarter of 2017.

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