GSDF is a challenge fund mechanism which addresses the skills needs of enterprises operating in both the formal and informal sectors of the economy of Ghana. The Fund is a demand-driven response to two of the most critical challenges encountered by the productive sectors in Ghana, namely a qualified and skilled labour force and the acquisition and development of technology towards increased productivity and practical innovations. The primary beneficiary targets for this fund include micro and small enterprises that seek to grow their businesses in order to create more jobs and increase productivity. These enterprises can come from the formal and informal sectors.

Enterprises that develop innovations relevant to solving societal challenges have a good opportunity to benefit from this sub-component, so are organizations that seek to advance their technologies and scale up their operations. In the last 2 phases of SDF, a total of over USD54 million was disbursed to support over 700 grants, resulting in skills upgrading of over 100,000 employees of 43,000 small and medium enterprises across all sectors of the Ghanaian economy, leading, in many cases, to three-fold improvement in the productivity of beneficiary enterprises. Part of the grants was also given to support Training Institutions to develop demand-driven innovative training contents required by industry for enhanced productivity and competitiveness.