Government to Reduce Poverty Through Micro Finance

Ms. Hannah Tetteh, Minister for Trade and Industry, yesterday said the government will use micro finance as a key strategy in reducing poverty and achieving the country's Millennium Development Goals.

"Micro finance has emerged as a leading and effective strategy for poverty alleviation with the potential of transforming the lives of the vulnerable in society. The Government is committed to improve the environment for micro finance institutions to succeed," she said.

Ms Tetteh made the observation in a speech read on her behalf by Mr. Francis Kusi, Coordinator of Micro, Small and Medium, Enterprises Project, at the inauguration of Avenor Branch of Adehyeman Savings and Loans Company in Accra.

She noted that micro finance has improved the quality of life of micro entrepreneurs in least developed countries by stabilising the cash flow of their economic activities and provided security for their enterprises.

She said under the Micro, Small and Medium Enterprise Project, five banks have benefited from the Line of Credit facility, Partial Credit Guarantee programmes as well as technical assistance.

"The Ghana Micro Finance Institutions Network established to train its members in development and use of best practices in delivery of micro finance services is also benefiting from this project," she said.

Ms. Tetteh said that micro small loans credit have also been instituted by the government to help MSME gain assistance in the form of small loans with interest rate of 10 per cent.

She called on the management of Adehyeman Savings and Loans Company to render quality services to its customers since an access to banking and increased security will promote a sense of entrepreneurship and increase their self esteem in society.

Mr. Phillip Cobbinah, Assistant Director, Banking Supervision Division at the Bank of Ghana, said most of the financial institutions relied on information provided by customers but sometimes such information is not available leading to constraints and the customers being eventually denied credit.

Mrs. Sarah Sadava, Chief Executive Officer of Adehyeman Savings and Loans Company, said management has planned to expand its loan portfolios, improve delivery channels, increase client options and enhance its security and control measures next year.

The company was incorporated in July 2004 and focuses on micro finance activities through the mobilisation of savings from the retail public and provision of credit, largely to households, micro and small businesses.

Source: GNA