The Car Rental Association of Ghana (CRAG) has signed a Memorandum of Understanding (MoU) with Bank of Africa Ghana Ltd to establish a dedicated Vehicle Finance Facility (VFF) for its members.
The agreement, signed by the Executive Council of CRAG and officials of the bank, is expected to improve access to vehicle financing and strengthen fleet acquisition across the car rental industry.
Under the arrangement, CRAG members can access financing of up to 90 per cent of the cost of vehicles. The facility covers new vehicles and used vehicles that are less than five years old.
The loan tenor is up to 60 months, with a competitive fixed interest rate starting from 15 per cent per annum. The agreement also outlines defined documentation requirements, a clear application timeline, and structured collaboration between Bank of Africa and CRAG for referrals and support.
Members will be required to pay a one per cent flat facility fee and a one per cent flat arrangement fee on the approved amount, both payable upfront.
CRAG has encouraged its members to participate fully in the process to understand the operational procedures, eligibility requirements and disbursement structure.
Speaking at the signing ceremony, the Executive Director for Business Development at Bank of Africa Ghana, Mr William Boateng, said the partnership aligns with the bank’s broader mission to support key sectors of the economy.
“Bank of Africa, we are part of the group that is represented in 20 African countries and also in China as well. We have a mind to operate and invest in the productive sectors of the economy,” he said.
He said that the bank’s role goes beyond traditional banking.
“For us, it is not just banking as a thing, but we look out for the areas that prepare the development of the country. And that is where we are coming in,” Mr Boateng explained.
According to him, the bank is keen to partner institutions and sectors that drive national development. He described the car rental industry as one that shapes visitors’ first impressions of Ghana.
“When you get into the country, you get the sense of the country, the friendliness and everything once you are moving, for who is taking you. And that is the part of the partnership that we’re looking to embed,” he said.
Mr Boateng added that the improving economic climate presents an opportunity to build sustainable partnerships.
“This year, as you see how the economy is settling now, it gives us a strong opportunity to foster relationships that will build the economy and then sustain it,” he said.
“It requires all of us to collaborate. So for Bank of Africa, we are looking forward to this collaboration.”
He clarified that the MoU allows the bank to treat CRAG members under a special framework.
“The essence of the MoU is that we are treating them special. We treat them differently from our normal processes that they would have gone through if we have not done this,” he stated.
He assured members that applications would be handled under the umbrella of the agreement.
“Once we have an individual applicant, we will treat it within the umbrella of the MoU and we wouldn’t have to follow the normal processes that ordinary customers would go through. So that should reassure them that things will be quicker and the processes will be faster,” he said.
Mr Boateng added that the bank would assess each case individually while working closely with the association.
“We look at the strength of each of our customers and then we do what is right and appropriate for them to support them. We will take it case by case,” he explained.
He also noted that CRAG would play a role in recommending members and ensuring compliance with agreed terms.
“An aspect of the collaboration is also to get recommendations from the association so that they also stand in and ensure that their members are operating according to the rules of the game,” he said.
Speaking to Myjoyonline, CRAG President Michael Sarpong described the agreement as a major breakthrough for the association.
“In terms of our signing the MoU with Bank of Africa, it is a very good deal for our association in terms of us accessing cars or sourcing cars from the industry that gives cars,” he said.
He explained that limited access to financing had made it difficult for members to acquire new vehicles.
“Without that, it will be very difficult for us to access new cars because some of our customers complain sometimes that they need to use new cars and all that, and the facilities for us to get new cars were difficult for us,” he said.
Mr Sarpong said the new facility would allow members to expand and modernise their fleets.
“Now that Bank of Africa has given us this privilege and signed the MoU with us, they are going to give us money to buy more cars and increase our fleet. It will benefit our association and that will grow because we drive tourism,” he noted.
He said the importance of the car rental sector to Ghana’s tourism industry.
“When people come to Ghana, they use us. We take them from point A to point B. If we do not have this kind of infrastructure, that will not support our tourism industry,” he said.
Describing the deal as historic for the association, Mr Sarpong added, “Being the president of the Car Rental Association, I think this is the first of its kind for us. We are going to improve very well in terms of fleet management.”
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Source: www.myjoyonline.com