THE ROLE OF MICROFINANCE INSTITUTIONS ON THE ECONOMIC DEVELOPMENT OF GHANA

Abstract

Microfinance refers to the provision of financial services to the poor-low income clients, including, consumers and the self – employed (Ledgerwood, 2000),Christen et al (2004) asserted that microfinance refers to a movement that envisions “a world which as many poor and near-poor households as possible have permanent access to an appropriate range of high quality finance services and the management of small amounts of money through a range of products and a system of intermediary functions that are targeted at low income clients. The aim of the study was to identify the role of microfinance institutions on the economic development of Ghana in relation to employment, revenue generation to the economy of Ghana and their social responsibility to their operating areas. The targeted groups for the study were the sampled managers of Microfinance institutions, employee working at the institutions as well as SME’s benefiting from the microfinance institutions. The researcher also obtained information from published documents which include; written records, articles, broachers, internet etc. The study again provide a clear description of how data was collected to enhance the readers understanding and evaluation and also aid interested parties in replicating the study. It includes sections such as research design, population, data source and data analysis, sampling techniques and methods of analysis. After the analysis, the researcher found out that microfinance institutions have contributed immensely to the development of Ghana through provision of monitory services in the form of loans, promoting small scale businesses and reduction of unemployment rate.