ROLE OF SOCIAL INVESTMENT FUND (SIF) IN POVERTY REDUCTION, A CASE STUDY OF CEDI FINANCE'S MICRO-FINANCE PROGRAMME IN THE ASHANTI REGION

Abstract

Poverty is one of the most captivating challenges facing most developing countries and Ghana is no exception. There seems to be a wide gap between the haves and the have not. To curb poverty, micro-finance has emerged as an antidote to the problem of poverty. Micro-finance encompasses micro-credit, micro-insurance and micro-savings. The SIF has therefore emerged as an institution that champions poverty reduction in its operation area and has adopted microfinance as one of the vehicles of poverty reduction. In Ghana, there seems to be the over concentration on micro-credit which gives credit to the poor to help them start income generating activities and expand the existing ones which will boost their income levels and lift them above the poverty line. The study explored the causes of the inefficiencies of SIF' s microfinance programme in the Ashanti Region by concentrating on the Cedi Finance Foundation (The Micro-finance Institution). The sample survey was used and data was collected using structured questionnaire and an interview guide. In all, questionnaires were distributed to 120 beneficiaries; the Zonal Officer and Project Officer of the SIF and the Credit Officer of Cedi Finance Foundation were interviewed. The results from the analysis, show that inappropriate loan repayment arrangement, delays in the release of loans, cumbersome loan application process, and crude and unsavoury methods of loan recovery are among some of the causes of the inefficiency of the programme. It is recommended that Cedi Finance Foundation should streamline the repayment arrangement, categorization of the poverty levels of beneficiaries and charging interest rates based on the purpose of the loan, proper and strong team put in place to monitor client activities.