Financial sector policy reforms and credit provision in Ghana

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This study examines the effects of financial liberalization and policy reforms on credit delivery in particular and financial sector development as a whole. Financial sector development in Ghana has been influenced by a number of factors. Prior to the FINSAP reforms, government policy mistakes, macro-economic problems, and the lack of financial infrastructure together created a repressed financial system. With hindsight, the financial policies pursued under FINSAP were directed instead at improving the operational efficiency of financial institutions, rather than addressing the structural constraints in financial intermediation. The financial sector continues to exhibit weaknesses after a decade of FINSAP due to the problems of macro-economic instability, lack of competition, and the lack of an enabling financial infrastructure. It would be illusory not to link financial sector development to the economic development of the country as a whole. At the end of the day, the responsibility for ensuring a soundl and efficient financial system lies on government to promote a stable macro-economic environment, besides efforts to overcome infrastructural and institutional constraints.
A thesis submitted to the Board of Postgraduate Studies, Kwame Nkrumah University of Science and Technology, Kumasi, in partial fulfilment of the requirement for the award of the Degree of Master of Science in National Development Policy and Planning, 1998