Browsing by Author "SHIRLEY, BERNIE SERWAA"

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    Determining the causes and impact of loans default on the operations of credit unions; A Case Study of St Joseph the worker cooperative credit union.
    (August, 2015) SHIRLEY, BERNIE SERWAA
    Credit Unions in Ghana currently provide significant financial services including microcredit facilities particularly to the rural and semi-urban areas across the country. Granting of microcredit facility (Loan) is a major activity of St Joseph the Worker Co-Op Credit Union and the loan portfolio constitute a significant proportion of the assets of the union. Undoubtedly, the union derive most of its interest incomes from loans, however, not all loans granted to beneficiaries perform well and earn the expected returns and this tend to have adverse effect on the quality of the loan portfolio. The study therefore analyses the socio-economic characteristics of clients, the factors accounting for loan default assess the rate of growth and impact of loan default on the general operations of St Joseph the Worker Co-operative Credit Union. Stratified and Purposive sampling techniques were used to select hundred loan clients and two Loan Officers respectively for the study. Questionnaire and interview guide were used to collect data for the study. Business failure, lack of monitoring of loans, Low level of income, inadequate marketing avenues were identified as the principal causes of the default loans in the organization. Measures to control default were found to include the provision of collateral to cover loan amount especially to those in the informal sector, need for training on how to use the loans, effective and regular monitoring of the loan from the time of disbursement till the final repayment, loan officers should be resourced sufficiently at all times in terms of vehicle and other logistics to support the monitoring activities. It was concluded that the government and hence Bank of Ghana should regularly monitor and supervise the credit unions and also try and formalize most of the informal sector.