A major frustration among this group of people in poverty is the poor quality or low reliability of the instruments that they use to manage their meager incomes - for both savings and loans. In West Africa, it is very difficult for the poor to get loans, not to mention micro businesses, and even SMEs. Bank interest rates in Ghana vary from 37-43%; the average in microfinance institutions is 50-60%; the more informal way of saving, often called a susu, has interest rates up to 120%. Not to mention that if you save with a susu, you normally have to pay the susu man, so you are paying to save instead of being paid to save (as with typical savings accounts in banks). And it's not unusual for the susu man to run away with the money, leaving you with nothing.
|A VSL group in Dodowa|
|Another VSL group in Akropong|
Last week, we also had our second batch graduation of the Small and Medium Enterprise(SME) class with Hopeline. As a reminder, a person might start working with Hopeline through a VSL group, then move to a micro-finance solidarity group, where a little business training is given and the loans are a little larger than with the VSL. Then a business owner might move to the SME training, where they receive more in-depth training about running a business and develop a business plan for their business.
|The second SME class for Hopeline Institute.|