Micro finance, which has turned out to be a leading and effective strategy for poverty reduction globally is rather receiving less media attention in Ghana.
A recent media study on categories of issues covered by the media in Ghana from January to December 2006 saw micro financing at the 24th position with the number of stories at 193, representing approximately 0.30%.
Microfinance includes the provision of financial 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.
It includes loans, savings, insurance, transfer services and financial products and services.As usual politics topped the list of stories covered by the private newspapers with the figure at 12404 and 19.42%.
The Centre for Media Analysis and Research, (CMAR) conducted the study.
The Chief Executive Officer of Centre for Media Analysis, Dr Messan Mawugbe, who presented the findings challenged stakeholders to discuss the strategies in promoting small and medium enterprises and micro financing in Ghana and the extent to which the media could play an effective role.
“A well resourced media would equally project economic policies to enhance national development”, he stressed.
At a forum under the theme, “Micro Enterprising: The Role of the Media in Micro-Financing Policy Development”, a Director at the Ministry of Finance and Economic Planning, Mr. Kobina Amoah noted that although microfinance is not a panacea for poverty reduction, it could make sustainable contributions through financial investment leading to the empowerment of people.
He said the increasing role of microfinance in development has emanated from the fact that the poor need access to productive resources, with financial services being a key resource, if they are to be able to improve their lives.
“The recognition that microfinance can have significant impact on cross cutting issues such as women’s empowerment, reducing the spread of HIV/AIDS and environmental degradation as well as improving social indicators such as education, housing and health is growing.”
Mr. Amoah bemoaned that Ghana’s financial sector in spite of reforms still experiences a gap between the demand for and the supply of financial services.
According to him, since the beginning of government involvement in microfinance in the 1950’s, the sub-sector has operated without specific policy guidelines and goals.
A situation he said partially accounts for the slow growth of the sub-sector, lack of direction, fragmentation and lack of coordination.
“Partly due to the lack of direction, there has not been a coherent approach to dealing with the constraints facing the sub-sector.
Among the constraints are inappropriate institutional arrangements, poor regulatory environment, inadequate capacities, poor institutional linkages, inadequate skills and professionalism and inadequate capital.”
He recommended that better coordination and collaboration among key stakeholders, including the development partners, government and other agencies, could help to better integrate microfinance with the development of the overall financial sector.
“While Ghana has a reasonably diversified and supervised regulatory framework for formal financial institutions licensed by the Bank of Ghana, there is concern that appropriate regulation needs to be extended to other institutions operating in the microfinance sub-sector in order to improve the outreach, sustainability and efficiency of savings, credit delivery and institutional arrangements.”
He emphasized that the general policy direction of the sub-sector is that the government, “Shall support the building of an inclusive financial delivery system by improving and deepening financial intermediation to serve the poor and low-income populations with inadequate access to quality financial services.”
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