Microfinance services, a major tool for reducing poverty

Bawjiase (CR), March 22, GNA - The head of Microfinance and Small Loans Centre, (MASLOC) Ms Bertha Ansah-Djan, has said that accelerating access to credit for the vulnerable who are productive would alleviate poverty. She said: "Microfinance as a tool is one of the critical dimensions of the broad range of financial services for the productive poor and giving access to credit to a larger segment of the population within a reasonable period is fundamental."

Ms Ansah-Djan was speaking to journalists after a working visit to the Awutu-Efutu Senya Queenmothers' Association at Bawjiase, in the Central Region, at the weekend.

The visit afforded her the opportunity to familiarise with the activities of the members and to learn their challenges for assistance. The women are engaged in gari processing, bakery, palm oil extraction, soap making and goat rearing.

At Obrayeko, Ms Ansah-Djan said the women's vocation had good economic prospects and expressed optimism that with little financial support they would improve their living standards.

"They need managerial skills. and MASLOC needs to contract someone to help them build the factory to process the gari and develop the palm oil business. We need to improve the tools and equipments they use to make their business a profitable venture," she said. She said though the women were exemplary hardworking entrepreneurs, their business efforts were disjointed adding that they needed guidance to operate under one umbrella for posterity. Ms Ansah-Djan described the gari processing and palm oil industry as a very lucrative venture. Naakye Dode Akaabi, Queenmother of Bawjiase Traditional Area and a member of the association, said her people were mainly farmers who needed financial support to expand their business. She said the financial institutions they sought help from had failed them and the 35 per cent interest rate they proposed to charge was quite high.

Naakye Akaabi said sometimes they had to credit the raw materials to process the gari after which they paid the loan. She said with the right support, the association could empower the women to engage the youth in the business and discourage them from migrating to the urban areas for employment. "The business prospects are high and many people travel from Nigeria to buy gari. The market already exists and the prospect is high if we are to expand the business," she said.

MASLOC was established to serve as the fiduciary agency of government for the prudent and judicious management of government and development partners' funds for micro and small-scale- credit programmes. The objective of the scheme is to support government's programme of a sustainable reduction in poverty as indicated under the Growth and Poverty Reduction Strategy (GPRS) by providing micro credit and small loans to the productive poor of the population.

MASLOC's facilities are principally targeted at the marginalised productive poor who fall mostly within the micro, small and medium enterprises sector and these include women, physically challenged and the youth.

The most common tenure of the loan facilities is 12 months, applicable mainly to commerce, with one to three months moratorium depending on the nature of the project.

The maximum period is up to 24 months which is normally applicable to new projects such as tractor purchase and operation, pineapple cultivation, piggery as well as institutional lending for the purpose of on-lending or retailing to end-users.

Disbursement of MASLOC loans is done through participating financial institutions and there are currently nine banking groups in partnership with the centre to disburse and recover loans from clients. 22 March 10