Microfinance Programmes and the Poor: Whom are They Reaching? Evidence from Ghana

Posted: 21 May 2009

See all articles by Joseph Kimos Adjei

Joseph Kimos Adjei

affiliation not provided to SSRN

Thankom Gopinath Arun

University of Central Lancashire

Date Written: May 21, 2009

Abstract

A key objective of microfinance programmes is to provide financial services to poor people who are excluded from such services by the formal banking system. It is in this perspective that governments, development partners and donor agencies continue to provide support to such institutions, to enable them to deepen their outreach. This paper examines the type of poor people served by one of the leading microfinance institutions in Ghana. By comparing the living standards of clients of Sinapi Aba Trust (SAT) with those of non-clients, representing the general population in its operational areas, the paper concludes that the microfinance institution reaches disproportionately a smaller percentage of very poor people. The study notes that programme placement plays a key role in determining the type of clients reached by SAT, since almost all its branches are located in urban centres. It finds that the objective of financial sustainability being pursued by SAT has eventually caused it to shift the provision of financial services from very poor households to the less poor.

Keywords: Microfinance, Depth of outreach, Poverty, Standard of living, Financial sustainability

Suggested Citation

Adjei, Joseph Kimos and Arun, Thankom Gopinath, Microfinance Programmes and the Poor: Whom are They Reaching? Evidence from Ghana (May 21, 2009). Available at SSRN: https://ssrn.com/abstract=1407980

Joseph Kimos Adjei (Contact Author)

affiliation not provided to SSRN ( email )

Thankom Gopinath Arun

University of Central Lancashire ( email )

United Kingdom

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