Microfinancing in Ghana
In 2006, the Nobel Peace Prize was awarded to Mohammad Yunus and the Grameen Bank of Bangladesh “for creating economic and social development from below”. The bank founded by Yunus grants micro-loans to people too poor to get credit from commercial banks. The borrowers are mostly women, who borrow money in groups and support one another. We at action five are now delighted to be able to support this excellent idea in a region which had hitherto offered no comparable opportunities.
On 23 July, Martin Wilde and his wife Nana Aidoo-Wilde presented the country of Ghana and a microfinancing project in Drobo. Mrs Wilde comes from this area on the border with the Ivory Coast and campaigns for the region’s development both here in Germany and on the ground in her home country. She has come to realise that many people, particularly women, that have the ideas and motivation necessary to start a small business, have no access to the loans they need to put their ideas into practice.
For this reason, she supported the foundation of an organisation in Drobo in which women come together to further their own opportunities and promote the development of their community. They have already begun to implement the concept of micro-loans and have now asked us to help expand the project. After the project was introduced to us in July, we familiarised ourselves with the microfinancing concept and how it is being turned into a reality in Drobo, ultimately deciding to accept the application and provide 2,000 euros to fund additional loans.
As early as September and October 2008, between ten and twelve women are scheduled to receive a micro-loan funded by action five. The money may be used to expand or improve farmland for cultivation or open a small business. After six months, the loans are to be repaid, which makes sense in Ghana given the seasons and harvest times. If the process is completed successfully, more loans are then granted for the next six months.
The concept behind micro-loans permits people in dynamic developing countries such as Ghana to benefit in a myriad of ways. As the direct recipients of the loans, the women are able to enhance their sources of income and make them more reliable. This enables them to secure their long-term livelihood and gradually improve their standard of living. Furthermore, the women’s families also benefit from this, which means in particular that their children can go to school. Finally, the entire local society profits from the extra business in the region and the fact that successful start-up businesses act as role models.