How do microlenders provide housing microfinance in a country where economic growth has slowed and interest rates have increased? In Ghana, three microlenders—Global Access, HFC Boafo and Sinapi Aba—have seen their housing microfinance lending move away from the construction of private dwellings to the construction of income-generating assets. Despite small and medium enterprises being hard hit by the worsening economy, this change has allowed for the microlenders to viably continue to provide loans for small-scale construction. However, the high interest rates, combined with the shorter terms on small and medium enterprise loans, means that the availability of housing microfinance will remain limited. Improving the housing support services provided in conjunction with the loans, improving operational efficiency and cutting costs are among the measures that can be implemented to support the sustainability of the sector.
We hope that this case study, and the other case studies in the series, contribute to the development of imaginative solutions by housing finance practitioners across the continent, assisting them in adapting initiatives to manage the vast array of challenges they face daily.
This case study was prepared with the support of FSD Africa