FORTY PERCENT: Dr. Andrew Asamoah expected 3% loans from Europe but found rates near 40%

Entrepreneur Dr. Andrew Asamoah returned to Ghana with plans to build what would later become A&C Mall, expecting the banking system to support him the way it had in Europe. Instead, he got the shock of his life.

Speaking to Kafui Dey, the entrepreneur said he arrived in Ghana believing he could finance the project through bank loans, just as he would have in Switzerland.

“Having stayed in Geneva, I knew that if I wanted to buy property and I had 20% of the value, every bank would support me,” he recalled.

But Ghana’s banking reality was completely different.

“The banks were not used to long-term 20-year or 25-year loans,” he explained. “The interest rates were very high.”

When Kafui Dey asked him what rates he had been used to abroad, Dr. Asamoah contrasted the figures.

“There, you could get a loan for 2.5%, 3% or 3.5% a year. I came here and they asked me for 40%,” he said with a laugh. “That’s crazy.”

According to him, borrowing at such rates would have made the project financially impossible.

“When you take a loan at 40%, almost every two years the principal doubles. It just couldn’t work.”

He believes the lack of affordable, long-term financing remains one of the biggest obstacles facing indigenous Ghanaian entrepreneurs, arguing that local businesses are forced to compete against foreign investors who often secure cheaper financing overseas.