Effective Techniques To Recover Debt In Ghana

Introduction

Business entities raise funds to keep them in operation. These funds may be sourced from the profits earned from the business (retained earnings), through borrowing (debt capital), through the issuance of shares (equity capital) and other sources such as crowdfunding.

In Ghana, debt financing is an attractive option for many businesses since it offers some tax benefits. One of such advantages is the deductibility of interest payments which can reduce a company's taxable income.

Companies obtain debt capital through bank loans or by issuing debentures, leases, or mortgages. Companies that receive the debt capital are the borrowers or debtors while those that give out the debt capital are the lenders or creditors. This relationship is regulated by the Borrowers and Lenders Act, 2020.