Challenges Faced by Petty Traders in Accessing Loans from Financial Institutions: Evidence from the Upper West Region of Ghana
Charles Adusei *
Department of Accounting, Banking and Finance, Garden City University College, Kumasi, Ghana.
Festus Adu Attafuah
Department of Accounting, Banking and Finance, Garden City University College, Kumasi, Ghana.
Isaac Tweneboah-Koduah
Department of Managerial Sciences, Garden City University College, Kumasi, Ghana.
*Author to whom correspondence should be addressed.
Abstract
Access to finance is a key determinant for business start-up, development and growth for small businesses. This paper focused on the challenges faced by petty traders in accessing loans within Wa Central in the Upper West Region of Ghana with a sample of eighty-one respondents for both the questionnaire and the interview. The data collected was analysed using descriptive statistics, Pearson correlation matrix and Kendall’s coefficient of concordance. The study showed evidence that high interest rate charged; demand for collateral and poor records keeping by petty traders were the challenges of accessing loans. The paper suggests that petty traders must keep proper records and the need for financial institutions to reconsider its stringent eligibility criteria for petty traders, Finally policy makers must create an enabling operating environment for micro enterprises to flourish.
Keywords: Petty trading, accessing loan, financial institutions, lending, mixed method