Regulation and Performance of Ghana’s Multi-tiered Rural and Microfinance Industry

This chapter describes how Ghana's savings-based and multi-tiered rural/microfinance industry has evolved and performed under a relatively flexible and adaptive regulatory framework to provide access to financial services to a growing share of Ghana's population. Ghana has been an innovator in financial institutions and regulation. Regulatory and legislative changes permitting new types of institutions serving different market niches have responded to initial problems in performance and supervision. Performance has been generally good in terms of growth, outreach and sustainability. Government has played a dual role, funding capacity-building and supporting apex institutions that have helped to improve performance, but also engaging in directed, subsidized credit schemes that have tended to undermine repayment. Apex organizations play an important role in service delivery, capacity building and self-regulation