1.1 Introduction
Basing on historical data, the economy of Ghana has been rising steadily since 1960 (Ghana, 2015). Today, it is one of the leading economies in West Africa. Poverty too has been reducing significantly, implying that it is one the right track to satisfy the Millennium Development Goals embraced by global leaders in 2000 (Harsch, 2008). However, something strange has been happening presently, poverty reduction level has become static. Mpoke and Kpodo (2014) state that Ghana is slowing losing the admiration it magnetized in Africa. Part of the problem as explained by Ndulu (2008) could be its failure to implement proven economic reforms. The previously mentioned in conjunction with other factors introduces the question of how it can end the vice, even the escalating poverty. Based on several studies, strengthening of microfinances could be the breakthrough. In the past, microfinances proved effective in creating employment, building economy, and above all, reducing poverty. This research focuses on the entire idea of microfinance as a perfect tool of reducing poverty in Ghana.
1.2. Problem Statement
Poverty is a great obstacle to economic development. Research indicates that it can really limit the potential of a nation. Accordingly, if a nation succeeds to tame it, then growth becomes inevitable. In view of that, while there are several ways of improving the welfare of individuals, some are more result generating than others are. Those that offer individuals finances seem to be more effective even as demonstrated by various studies. In consequence, encouraging in addition to bolstering microfinancing in Ghana will be a step in the right direction. Those likely to benefit from this genre of financing are emerging entrepreneurs as well as small-scale businesses. In addition, microfinance has the potential of reaching a vast array of poor people.
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However, in spite of the proven benefits of microfinance, Ghana is presently grappling with poverty. Currently, there are more than 6.2 million poor people Ghana. Even worse, it appears as though nothing is improving, as things are getting worse each day. The problem Ghana faces is not new or unsolvable. Moreover, the fact that its poverty levels are rising does not negate the established transformative power of microfinances. After a series of researches, it came out clear that its main problem lies in the way microfinance institutions operate in the country. In reality, they are more concentrated on certain regions over others.
1.3. Significance of the Research
It is true that Ghana like other nations desires to end poverty. It is also undeniable in view of the previously mentioned that Ghana will not hesitate to examine any poverty reduction proposals forwarded to it. For that reason, this research is important in many ways. First, it acknowledges that Ghana has the potential to end the vice. Secondly, it builds up on the existing research regarding the topic in consideration. Thirdly, it lays bare some of the challenges the nation faces concerning the course. Lastly, it comes at a time when the topic is ripe not only in Ghana but also worldwide.
References
Ghana. (2015). Retrieved October 10, 2015.
Harsch, E. (2008). Closing Ghana's national poverty gap Africa Renewal Online . Retrieved October 10, 2015.
Kohn, D 2013, Microfinance 3.0 Reconciling Sustainability with Social Outreach and Responsible Delivery (Aufl. 2013 ed.). Berlin, Heidelberg: Springer Berlin Heidelberg.
Mpoke, M., & Kpodo, K. (2014, June 13). Once a model for Africa, Ghana's economy loses its shine , Retrieved October 10, 2015.
Ndulu, B. (2008(. The political economy of economic growth in Africa, 1960-2000 . Cambridge University Press: Cambridge.
