To unlock capital for startups and SMEs, the Government of Ghana has mandated pension and insurance funds to invest at least five percent of their assets in venture capital (VC) and private equity (PE) by 2026.
The directive was unveiled during the launch of the Ghana Venture Capital and Private Equity Compact in Accra, as part of efforts to fuel economic transformation and support high-growth sectors under the African Continental Free Trade Area (AfCFTA).
Why Ghana is pushing pension funds toward venture capital
Less than one percent of Ghana’s pension assets are tied to alternative investments, despite regulatory allowance for up to 25 percent. The new policy aims to shift this dynamic by channeling long-term funds into fintech, agribusiness, and clean energy sectors.
According to Frederick Asiamah from the Ministry of Finance, VC and PE offer not just funding but also the innovation and business guidance that traditional banks often lack due to strict collateral requirements. The initiative mirrors Germany’s Mittelstand model, where SMEs are central to industrial growth, and seeks to make startups key players in Ghana’s economic agenda.
Government-led investment driving the shift
The government is already leading by example. The Minerals Income Investment Fund (MIIF) manages Ghana’s mineral royalties and has begun investing in SMEs through Injaro Ghana Venture Capital Limited (IGVCF). One of its key investments is Zeepay Ghana, a fintech company that received $2 million in 2023 to expand mobile remittance services in mining communities.
Another is Kofa Technologies, a green energy startup developing lithium-based batteries—an investment that aligns with Ghana’s recent push into the lithium sector. MIIF has also backed DDP Outdoor Limited, an advertising agency that serves clients in the mining industry. These strategic investments are designed to generate strong returns for Ghanaians, who ultimately own the country’s mineral wealth.
Although the policy has been positively received, the rollout may face some practical challenges. Fund managers’ ability to identify and support high-potential VC and PE opportunities will be crucial. The government’s message is clear: alternative financing is no longer optional, it’s a key part of Ghana’s economic playbook moving forward.
