Data is beating debt: How myCreditScore is changing lending in Ghana

Ghana's credit market faces serious challenges. Nearly a quarter of all loans go unpaid. However, a local fintech solution is changing this situation.

The latest myCreditScore Defaulter Pattern Analysis Report shows promising results. Loans backed by myCreditScore have lower default rates than the national average of 23%. Lenders using this platform make safer decisions. This unlocks financial access for thousands while reducing risk.

The National Problem: Default Rates at 23%

The Bank of Ghana reports a non-performing loan rate of about 23%. This means nearly one in four loans goes unpaid. These defaults cost banks billions annually. They also increase interest rates and limit credit access for responsible borrowers.

The Smart Solution: Predictive Credit Scoring That Works

myCreditScore analyzed over 21,000 credit records. This included 2,061 confirmed defaulters to find behavioral patterns and risks. The findings were insightful and game-changing.

Who Are the Typical Defaulters?

- Age: 62% of defaulters are aged 30–50.
- Occupation: Common jobs include traders and transport workers.
- Marital Status: Singles and divorced individuals are at higher risk.
- Region: 67% of defaults occur in urban areas.
- Gender: Males are 1.4 times more likely to default.

National Default Rate vs. myCreditScore-Backed Loans

Loans filtered through myCreditScore see up to 65% lower default rates compared to the national average.

Why People Default: The Traps

Defaulting follows certain patterns:

- Micro-loan traps: 73% had loans under GHS 25,000.
- Income instability: 68% worked informally or seasonally.
- Over-leveraging: Average defaulters had three or more loans.
- Short credit histories: 67% defaulted within six months of opening an account.

How Does myCreditScore Work?

myCreditScore uses a real-time scoring system that considers:

- Age, occupation, location, marital status
- Social media footprint and payment behavior
- Tiered risk categorization and credit limits
- Rewards for positive repayment behavior

Predictive Scoring Benefits: Risk Category Estimated Default Rate

- High-risk (traders, informal jobs): 60–80%
- Medium-risk (young workers, small businesses): 40–59%
- Low-risk (teachers, healthcare): <20%

Real Impact: Safer Lending, More Inclusion

Projections show that lenders using myCreditScore can expect:

- A reduction in defaults by 25–30% in six months
- Loan decisions made 40% faster
- Operational costs for small loans reduced by half

This creates a growing customer base built on trust.

A Path Forward: Smarter Lending for Ghana’s Future

Ghana's economic growth relies on accessible credit. This is especially true for small traders and young entrepreneurs. MyCreditScore shows that with the right data, default is not destiny.

Lenders should consider integrating myCreditScore into their workflows. The future of lending in Ghana is data-driven, with promising results already visible.

No developed economy operates without credit and loans. In Ghana, over 95% of transactions are debit-based. Smarter decisions today will build stronger credit systems for our growing economy.

Author: Louis Gyimah
Tags: Ghana News, mycreditscore