Women’s productive activities and informal credit: a case study of Atebubu District

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The Atebubu district economy like the national is a dualistic economy with a large informal sector and a small formal sector. Women, who constitute the backbone of rural informal manufacturing and commercial sectors, occupy a subordinate status by virtue of their traditionally ascribed gender roles, marginalised in decision-making processes and relatively disadvantaged with regard to resource allocation. Their relative lack of basic literacy and numeracy and marketable skills confines them to the residual portion of the informal sector. Difficulties in capital formation and access to formal institutional credit is adjudged to be the most critical constraint to the productive activities of women in the informal sector, yet these same characteristics combine with operational constraints in the formal financial sector to marginalise their patronage of formal financial institutions and access to institutional credit. Their marginalisation by formal financial institutions thus pushes them into using informal financial institutions. The commonly held notion that informal financial institutions are safe havens was however not substantiated by the facts gathered in the study. Except for hopes offered by some informal institutions for intermediation, the usage patterns of respondents and the performance of the enterprises studied show that they are not viable options for investment capital. Enterprises funded from these sources are typically small, with marginal and sometimes, negative returns, slow rates of expansion and a life span akin to the developmental cycle of the family- specifically to the period in which the procreation and upbringing of children takes place. This state of affairs explains why the manufacturing sector of Atebubu District is losing female labour to the Commercial Sector because of perceived higher returns. The increasing demand for non-farm employment, low returns to rural petty commodity production (with implications for family welfare ) and the threat of future migration to urban areas in search of better sources of livelihood calls for concerted efforts to address constraints to rural production and to ensure the integration of women into the main stream of the economy. The solutions advocated here range from practical to strategic interventions which would complement the efforts of banks and financial intermediaries, to grassroots mobilisation of financial resources informed by credit plus’ policies.
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 degree in Development Planning and Management, 1997