Vice President and NPP Presidential Candidate Dr. Mahamudu Bawumia has officially launched myCreditScore, Ghana’s first personalized digital credit scoring system. Licensed by the Bank of Ghana, this homegrown initiative aims to solve one of the most significant barriers to economic growth in the country: the lack of a transparent and reliable way to assess individual creditworthiness.
By providing a digital “financial report card,” the system allows Ghanaians to leverage their good repayment behavior to access loans, car financing, and mobile phones at more competitive interest rates.
How the System Works
The myCreditScore system aggregates data from various sources to generate a three-digit score. This score acts as a financial passport, allowing lenders to distinguish between low-risk and high-risk borrowers.
The scoring model is built on six primary factors:
- Repayment History (60%): The most critical factor, tracking the consistency of your loan and bill payments.
- Dishonored Cheques (15%): Penalizes instances of bounced cheques to protect lender trust.
- Judgment Debt (10%): Considers any court-ordered financial obligations.
- Socio-Economic Factors (7%): Includes job stability, regular income, and living conditions.
- Economic Assets (5%): Factors in your bank balances as a buffer for future commitments.
- Demographics (3%): Basic identity verification (Age, Nationality).
Impact on Non-Performing Loans (NPLs)
One of the most compelling arguments for the system is its potential to stabilize the banking sector. Ghana’s national NPL rate has hovered around 24.3% as of late 2024, a high figure that often leads banks to raise interest rates to cover the risk of default.
However, Dr. Bawumia revealed that the myCreditScore pilot project achieved an incredibly low NPL ratio of just 1.4%. This suggests that when lenders have access to accurate credit data, defaults drop significantly, allowing for a more sustainable lending environment.
The “Moments” of a 17-Year Journey
The launch marks the culmination of a journey that began in 2007, when the Credit Reporting Act (Act 726) was passed while Dr. Bawumia was Deputy Governor of the Bank of Ghana.
After nearly two decades of policy stops and starts, the integration of the Ghana Card, Mobile Money Interoperability, and Digital Addressing Systems has finally provided the data infrastructure necessary to make the scoring system a reality.