Heliyon (Dec 2023)
Effects of microfinance and small loans centre on poverty reduction in Wa West District, Ghana
Abstract
Poverty, a pervasive and consequential global issue, has garnered significant attention due to its wide-reaching prevalence and profound implications. Various strategies, including microfinance, have been implemented to tackle this pressing concern. One such strategy is the Microfinance and Small Loans Centre (MASLOC) in Ghana, which aims to reduce poverty. However, despite its potential, MASLOC's role in poverty reduction has yet to be thoroughly examined, leading to inconclusive findings, and necessitating this study. A single case study design addressed this research gap and provided valuable insights. A comprehensive dataset was compiled through interviews and observations involving 40 MASLOC beneficiaries and officials. Thematic analysis was utilized to dissect the collected data, revealing noteworthy patterns and trends. The study's outcomes shed light on MASLOC's effectiveness in mitigating poverty. Specifically, it was found that MASLOC played a pivotal role in poverty reduction by bolstering income levels, amplifying consumption patterns, facilitating access to fundamental necessities, and enabling the accumulation of valuable assets. Nevertheless, the analysis also highlighted specific challenges. Issues related to loan repayment and staffing emerged as constraints within the MASLOC framework. In essence, the study established that MASLOC contributes to the overarching goal of poverty reduction. The findings are helpful because fostering a positive attitude towards loan repayment is crucial, and this endeavour should be complemented by the strategic recruitment of competent staff members who can effectively navigate the intricacies of the scheme to ensure the sustainability of MASLOC. What sets this study apart is its innovative exploration of the impact of MASLOC on poverty—a primarily overlooked facet. By delving into this uncharted territory, the study enriches the ongoing discourse surrounding government microfinance schemes' influence on its beneficiaries. This research contributes not only to the academic realm but also to the practical realm, as it offers actionable insights for policymakers in poverty reduction.
