Barclays Launches Ghanaian Microfinance
Ghana , January, 06 2006 -
Barclays is connecting modern finance with one of Africa’s most ancient forms of banking, Susu Collection, in an unconventional mobile initiative. This will extend microfinance to some of the least affluent in Ghana, like the small trader at the market or the micro-entrepreneur selling from road-side stalls. Though their individual income is too small for ‘high street’ banking, collectively it amounts to a £75 million economy thriving below the traditional banking radar.
Ghana’s 4,000-strong Susu Collectors offer basic banking to the needy. For a small fee they personally gather the income of their clients and return it at the end of each month, providing greater security for their client’s money. In addition, with finance from Barclays the Susu Collectors will be able to provide their clients with loans, helping them to establish or develop their business.
“What we are doing is somewhat unique. Not only are we creating an account for Susu Collectors to deposit their funds, we are also providing them with loans of their own, which they can ‘lend-on’ to their customers, helping them build their capital,” said Margaret Mwanakatwe, MD of Barclays Bank of Ghana Limited.
“In the process, we are laying the building blocks for a truly financially inclusive society. Currently, over three quarters of Ghanaian society may not have access to high street banking.
“We are also providing capacity building training to Susu Collectors to make sure that they do their credit risk correctly and any training needs they may need.
“Finally, we are using our expertise to educate the clients of the Susu Collectors on basic financial issues. We are currently running a trial programme with 100 Susu Collectors. If it is successful, we would look to roll the model out to other African countries”, added Mrs. Mwanakatwe.
The programme has been developed in collaboration with the Ghana Cooperative Susu Collectors Association, the self-regulated apex body of the Susu Collectors, and the Ghana Microfinance Institutions Network (GHAMFIN).Notes to Editors:
Susu Collectors in Ghana are recognizable for their distinctive, many pocketed coats. Traditionally, they service a set area or group of families with whom they have developed a long relationship.
The formal launch of the microfinance products was held on the 19th of December 2005, at the Corporate Services Centre, Accra, with the Deputy Minister for Finance and Economic Planning, and Dominic Bruynseels, CEO of Barclays Africa in attendance.
The philosophy behind Barclays Microbanking is that a truly financially inclusive society can only be achieved by supporting existing, indigenous financial institutions that already provide financial services – either loans or savings facilities to the unbanked. To do this effectively, Barclays Microbanking offers a holistic approach which comprises three strands:
1. Microbanking “Dwetiri” Account – a specialized banking services. This involves capital for on-lending and facilities savings deposits for institutions. This has been designed in collaboration with the Ghana Cooperative Susu Collectors Association (GCSCA) for susu collectors.
2. Microbanking Capacity Training – a special capacity building training programme for participating microfinance institutions. It will be provided in conjunction with Ghana Microfinance Institutions Network (GHAMFIN) - in this case, the Susu Collectors.
3. Microbanking Financial Capability Programme. This is a financial awareness programme to help people gain the confidence to use basic financial skills in the effective management of their money. This is designed for the clients of the participating microfinance institutions.
• The Ghana Cooperative Susu Collectors Association (GCSCA), the self-regulated apex body of Susu Collectors in Ghana, is the lead partner in developing relationship with the Susu Collectors. The GCSCA will select 100 Susu Collectors for the pilot – 50 from Accra and 50 from Kumasi. They will undertake an initial screening of loan applicants before passing them on to the Barclays Microbanking Project. The GCSCA will also contribute to capacity building and the financial awareness campaign.
• The Ghana Microfinance Institution Network will organise and facilitate training and capacity building and participate in evaluating and recognizing the social impacts.