Assessing the impact of microfinance on production and income distribution - a case study of Ashanti Region

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Microfinance, and its impact, has received considerable attention over the last few decades, several studies confirm a positive impact on the beneficiaries. Nevertheless, these studies only consider the effect of a micro-loan whilst microfinance nowadays incorporates much more than just credit. This study seeks to assess some of the barriers to accessing microfinance, availability, and Affordability of the service, readiness of client to utilize the services as well as readiness of providers to render the service. The main objective is to assess the impact of microfinance on production and income distribution Kumasi Metropolis of Ashanti Region. « A descriptive current cross-sectional study was done from June 2008 to September 2008 in the Kumasi Metropolis with an estimated total population of 1,625,180. Simple Random sampling method was used to select 300 respondents from some microfinance and savings and loans institutions. At the end of the study, it was realized that 120 out of 300 respondents (40%) had accessed the service for more than twice and about 150 out of 300 (50%) had accessed it once. About 260 (87%) out of 300 respondents also confirms improvement in their living standards through the microfinance. But only 40 (13%) of respondents had not seen any improvement in their living  In conclusion, the fact that more people are accessing the services shows more people are embraracing the introduction of the service. Thus, there is still room for more to be done in terms of reasonable interest rates, flexible repayment terms, protection of deposits of others savings and proper training and education of staff of the microfinance institutions.  
A thesis submitted to the College of Arts and Social Sciences, 2009