Assessment of the Effectiveness of Ghanaian Micro-Finance Institutions in Promoting Entrepreneurs in Accra Metropolis

Abstract

Bank of Ghana in 2011 issued Micro Finance Rules and Guidelines with the aim of promoting entrepreneurship activities in micro and small enterprises in Ghana. The study examined the effectiveness of Micro Finance Institutions in promoting entrepreneurs in Accra Metropolis in the period 2011 to 2013. A purposive and simple random sampling technique was employed to draw the sample from the population. Personal interviews and structured questionnaires were used to facilitate the acquisition of relevant data which was used for analysis. Descriptive statistics which involves simple percentage and illustrations was purposefully applied in data presentations and analysis. The research revealed that only a few entrepreneurs had accessed loans from Micro Finance Institutions, due to high interest rates, ignorance of the existence of Micro Finance Institutions as well as lack of trust and confidence in the Micro Finance Institutions. It was concluded that Micro Finance Institutions in Accra Metropolis are less effective in promoting entrepreneurs. The researchers recommended that the Bank of Ghana and Ghana Association of Micro Finance Companies must ensure transparency and integrity in Micro Finance Institutions operations to increase their outreach. In addition, Ghana Association of Micro Finance Companies and its members must enhance public awareness about Micro Finance Institutions operations through various promotional strategies.

Keywords: Micro-Finance Institutions, entrepreneurs, micro and small enterprises, Accra Metropolis, GAMC

JEL Classification: RJFA