MICROCAPITAL STORY: Study Reveals Ghanaian Women Still Face Challenges Accessing Microfinance

A recent study funded by the Business Sector Advocacy Challenge Fund (BUSAC) has revealed that rural women accessing microfinance in Ghana continue to face barriers when compared with men. Dr. Irene S. Egyir, Lead Researcher on the project and Lecturer at the University of Ghana, spoke at a sensitization workshop saying that although women were participating in productive sectors, their lack of access to microfinance made it difficult for them to play their roles effectively, reported in The Ghanaian Journal. The research indicated that though most financial institutions had embraced the challenge of assisting micro businesses, females continued to receive less access to such credits.

The name of the study was not revealed in the article, nor whether it had been published to date, although it is reported to be funded by BUSAC, an organization that undertakes research which will assist the private sector to influence public policy formation. The research findings were presented on October 22, 2008 at a workshop for the Christian Mothers’ Association. The core objective of the study was to document the current situation of barriers to access of micro finance to rural women entrepreneurs and activities of Micro-Finance Institutions (MFIs) to create a foundation for advocacy action to make needed changes.

Past studies on women’s access to financial services in Ghana have also revealed that barriers exist for women accessing finance. A study by the International Fund for Agricultural Development (IFAD) in 2000 revealed that challenges that are unique to women accessing rural microfinance include not having time to leave their household duties to travel to the bank, finding male staff intimidating, illiteracy and semi-literacy. Further, an un-dated study of the Sinapi Aba Trusts (SAT), an Opportunity International MFI, was summarized in an article by the Global Development Research Centre (GDRC) and suggested that a number of barriers exist for women who want to graduate from group to individual loans. These barriers include not being allowed to use their loans to buy needed business assets and loan sizes preventing clients from making lump sum investments. The summary suggests that MFIs need to understand how gender roles shape women’s business opportunities and decisions.

BUSAC is a project originally launched by DANIDA, the Ministry of Foreign Affairs of Denmark, which is the official Development Aid Organization of Denmark. It began as part of the broader Business Sector Programme Support (BSPS) the USD 30 million program funded by DANIDA, to support the effort toward the “Golden age of Business”, in link with the Ghana Poverty Reduction Strategy (GPRS). BUSAC now attracts support from the UK’s Department for International Development (DFID), which provides support through an arrangement with DANIDA and the United States Agency for International Development (USAID). Its broad goal is to “facilitate the development and growth of the private sector by improving the environment in which businesses operate”. Further information on DANIDA’s work in Ghana can be found in this MicroCapital Story. Further MicroCapital stories on USAID’s involvement in microfinance can be found here.

By Lori Curtis, Research Assistant

Additional Sources:

BUSAC: “Ghana’s Private Sector Development Plan”

GDRC: “Is there really a ‘glass ceiling’ for women microfinance clients?”

The Ghanaian Journal: “Barriers still exist in accessing credit – Research”

IFAD: “Ghana – Women’s Access to Formal Financial Services”