In 1978, the U.S. Department of Labor relaxed key provisions in the Employee Retirement Income Security Act, allowing pension funds to invest in private equity (PE) firms, including venture capital groups. The change caused a tsunami of capital to new and growing firms, as capital under PE firm management went from $39 million in 1977 to $570 million in 1978. Startup and growth capital in the U.S. has never been the same.

This year, key changes from Ghana's 2008 pension law come into effect that might lead to a similar explosion in private equity and venture capital. The pension scheme is now mandatory for all public and private formal sector workers in Ghana; 13.5 percent of formal sector salaries will be deducted and placed under the management of Ghana's Social Security and National Insurance Trust. An additional 5 percent of each formal sector worker's salary will be deducted and placed under management of private institutional investors.

That 5 percent could be as much as $400 million annually for institutional investors, as Bloomberg News recently reported. About 25 percent of that will go into equities, implying $1.9 million in capital per week moving into a stock market with a current weekly turnover of only $1.8 million, according to the Bloomberg report. The rest of the estimated $400 million will go into local currency debt investments.

"The entry of new institutional investors is therefore expected to have a marked effect on the local equity market," a local economist told Bloomberg. "The new fund managers are also expected to make markets more liquid, efficient and transparent, offer alternative sources of financing from local commercial banks and stimulate financial innovation."

More competitive institutional investors and more liquid stock markets would be a boon for impact investors, who need buyers and liquid capital markets to make exits more frequent and more lucrative.

The new pension law also calls for a privately-managed voluntary pension scheme catering to the 80-plus percent of Ghanaians who work in the informal sector - i.e. Ghana's BoP markets. Just imagine: retirement savings from Ghana's BoP helping to finance Ghana's new and growing businesses. Time will tell if the scheme will gain traction, but it's tantalizingly close to reality.

Additionally, as workers never lose ownership of pension fund contributions, Ghana's new pension scheme allows both formal and informal sector workers to use the value of contributions under private management as collateral to obtain a bank loan. The effect that has on bank lending to Ghana's BoP still depends upon a range of other factors, but liquid collateral is a major step in the right direction.

There's no guarantee that Ghana's new pension law will produce the same results as the 1978 changes did in the U.S. Things could go smoothly for a few years until Ghana's economy hits a rough turn, and if there were any weaknesses in the transparency or accountability of pension fund manager governance, operations, licensing or oversight, then the whole system could collapse. In a speech at the launch of the new pension scheme, Ghana President John Evans Atta Mills urged pending pension fund managers to take the lessons of the recent global financial crisis to heart.

Plenty of blog posts on Nextbillion and elsewhere have provided glimpses of the development power of savings, including long-term savings for retirement, weddings, or funerals. Ghana's new pension scheme builds on the power of savings, mobilizing capital domestically rather than channeling capital from abroad, and using local savings for much more than just microcredit or buying central bank bonds.