Dr Sam Ankrah, an investment expert and development economist, has called on African governments, regulators and financial institutions to prioritise sound governance, institutional competence and risk-based supervision if the continent is to attract the billions of dollars needed to finance its growing informal economy.
Delivering the keynote address at the International Microfinance Investors’ Summit 2026 on “Repositioning African Microfinance for Growth and Stability” in Accra, Dr Ankrah said Africa could no longer treat microfinance as a social intervention but must reposition it as a credible and investable financial asset capable of driving inclusive economic growth.
He observed that while Africa’s informal sector accounted for the overwhelming majority of employment across the continent, it continued to suffer from a financing gap estimated at more than US$331 billion, limiting the growth of small businesses and entrepreneurship.
“The informal economy is not a fragment of the map; it is the map,” he said. “If we continue to underfinance the people who create jobs and sustain local economies, we will continue to slow Africa’s growth.”
Dr Ankrah argued that attracting investment into the sector would require more than increasing minimum capital requirements, stressing that “good governance produces capital—not the other way around.”
“Capital is not an input that can be legislated into existence. It is the output of institutions that are trusted,” he said.
Drawing lessons from financial sector reforms across Africa, including Ghana and Nigeria, Dr Ankrah noted that many institutions failed because of weak governance, excessive owner influence and poor board oversight rather than inadequate capital.
“Rules are not governance,” he said. “Until institutions separate ownership from management and strengthen independent oversight, we will continue to repeat the mistakes of the past.”
He urged financial institutions to improve the quality of their audited accounts, strengthen internal controls and invest in competent risk management systems, saying investors were increasingly looking beyond financial returns to institutional credibility.
Dr Ankrah also challenged regulators to move from compliance-driven supervision to risk-based regulation capable of identifying emerging threats before they develop into systemic crises.
“Supervisory ambition must be matched by supervisory capacity,” he stated. “Counting documents does not prevent financial crises. Understanding where risk sits does.”
On digital transformation, Dr Ankrah acknowledged Africa’s remarkable progress in financial technology and mobile money, which processed more than US$1.1 trillion in transactions in 2024.
However, he cautioned that technology alone could not compensate for poor governance.
“A badly governed institution that digitises simply makes bad loans faster and at greater scale,” he said, advocating what he described as “human trust powered by digital speed.”
Dr Ankrah further called on regulators to improve transparency by publishing market data, including consolidation and recapitalisation information, to enable investors to make informed decisions and strengthen confidence in Africa’s financial markets.
He also encouraged investors to expand the use of blended finance models that combine concessional and commercial capital to reduce investment risk, while urging regional institutions to establish pooled African microfinance investment facilities capable of attracting larger international funds.
According to him, Africa receives only a small share of global impact investment dedicated to microfinance, not because capital is unavailable but because too few institutions meet international governance and reporting standards.
“We are not choosing between stability and inclusion,” Dr Ankrah said. “A sector that collapses is not inclusive. A sector that excludes is not stable.”
He called for stronger collaboration among governments, regulators, development partners and the private sector to build resilient financial institutions that can mobilise capital, support small businesses and accelerate Africa’s economic transformation.
By: Dennis Osei Gyamfi
