Commercial banks in Ghana have started lowering interest rates on both existing and new loan facilities after the recent reduction of the Ghana Reference Rate (GRR).
John Awuah, Chief Executive Officer of the Ghana Association of Banks, explained that the adjustment has been almost automatic for many banks, particularly this week, following the GRR’s drop to 15.68%, effective 7 January 2026.
The reductions primarily affect borrowers with variable-rate loans, allowing their interest charges to align with changes in the benchmark rate.
Justifying the Reduction
Mr Awuah addressed criticisms over the seemingly modest size of the cut, noting that the GRR declined from 15.9% in December 2025 to 15.68% in January 2026. He emphasized that the change reflects actual movements in key financial indicators that determine the GRR.
He also dismissed suggestions that commercial banks are delaying the benefits for borrowers or reducing rates unfairly.
“The Ghana Reference Rate is a derived rate. It cannot change on its own unless there are movements in other indicators such as the monetary policy rate, Treasury bill rates, and interbank rates,” Mr Awuah said, clarifying that the GRR reduction is a direct consequence of these underlying changes.
Commercial banks are expected to continue adjusting lending rates in line with GRR movements, benefiting both businesses and individual borrowers.
