SMEs urged to pay back loans - Banks
Accra, May 11, 05, GNA - The Ghana Association of Women Entrepreneurs (GAWE) on Wednesday said lack of access to credit and other resources, including managerial skills hinder the growth of majority of informal sector operators in addition to Medium and Small-scale Enterprises (SMEs).
Financing constitutes a major handicap impeding the growth of women's businesses, Mrs. Lucia Quachey, President of GAWE said at the first forum on women entrepreneurs' access to credit in Accra. The forum, which would be in a series, is aimed at creating a platform for banks and women entrepreneurs at all levels to dialogue on how to access credit for the expansion of the informal sector and existing small enterprises. It was sponsored by the business Sector Advocacy Challenge (BUSAC) Fund, a DANIDA Business Sector Programme Support, aimed at supporting business sector advocacy in Ghana on a demand driven basis. She said poverty could not be reduced without enhancing entrepreneurial and management capabilities of women, adding that this had become a barrier for women.
She said it was the desire of women who constitute 90 percent of the 80 percent informal sector to work hard for their businesses to grow. She noted that banks were reluctant to lend money to women for their businesses because they had no collateral and could not make sizeable personal investment or keep proper record.
But representatives from some banks at the forum said collateral had become conditions for loans because most SMEs did not pay back loans accessed from the banks.
Mr. Charles Adumoah, Manager, Micro Finance, La Community bank said this was so because Ghanaians had not cultivated the habit of saving, which could serve as collateral for loans.
He said some women who were given monies under the Women Development Fund had not paid a cent since the disbursement two years ago, adding that this prevented others from accessing the loans.
Mr. MacJohn Geraldo of the International Financial Services said the institution would partner with GAWE and come out with an innovative invention that would help them access loans and also seek for financial support to set up a revolving fund for women to expand their businesses. He said his institution would not focus on credit alone but give the women training in managerial skills to help improve their stock taking exercises.