Title:
MICROFINANCE SECTOR IN GHANA: CHALLENGES AND RECOMMENDATIONS. A CRITICAL REVIEW OF LITERATURE

Authors:
ALEX ADDAE-KORANKYE, Ghana

Abstract:

Microfinance has been among the phenomena hotly debated by practitioners, researchers, and development agents as a tool for poverty reduction. However the microfinance sector is bedevilled with a number of challenges.  The study reviewed literature on challenges facing the microfinance sector in general and Ghana in particular and recommended solutions to the challenges. Some of the challenges faced by the clients include high interest rates and lack of training, whilst loan default, and sustainability issues are some of the challenges confronting microfinance institutions. It was recommended that clients of microfinance institutions should set up their own micro-bank, government should secure loans for the clients at reasonable interest rates, Bank of Ghana should intensify its supervisory and monitoring role, and both the clients and MFIs should be trained, among others.