Editorial: Not Another Mircro Credit Politics

The launching of a $50 million micro credit scheme on Wednesday to provide capital to small and medium scale enterprises could not have come at the right time.

During the launching, President Kufuor was candid enough to say that the scheme is not the first to be launched in the country. Indeed right from the PNDC days through the NDC and the current regime, Ghanaians have witnessed the politics of poverty alleviation, which have left more questions unanswered.

One of the questions is, how effective have past and present governments been managing the numerous micro credit schemes? We have heard several stories of how many beneficiaries of the micro credit funds failed to pay up so that others could benefit.

Those who failed to pay-up have simply been left off the hook, because they happened to be relatives and friends of ministers, district chief executives, top party executives and public officials. In short, the money in the past went to wrong hands; the people who are well connected to the powers that be.

The lack of credit for women in particular, who head many households, is quite disturbing and it is hoped that this new scheme will reach out to the women.

So will this new scheme make any difference? Will the money be sent to the remotest parts of the country so that those who desperately need capital can access the funds? President Kufuor hit the nail on the head when he cautioned future beneficiaries that the money is not for party functionaries.

To ensure that the credit is equitably distributed, district chief executives or party functionaries should not have any role to play in implementing the scheme. The arbitrary misuse of the district assembly's common fund by some DCE is enough to warn the government that political office holders will undermine such a national programme, meant to empower Ghanaians economically.

Remarkably, the demands for collateral securities by the banks in addition to the huge interest rates accompanying bank loans are not part of this scheme. It is however heartening to note that interest rate under this scheme is as low as ten percent. This will enable many people to access the credit. Perhaps, the most refreshing news is that no collateral security will be demanded under the scheme.

It is only hoped that President Kufuor will take personal interest in the disbursement of the credit and ensure that the aims and objectives of the scheme are achieved. The appropriate structures and regulations must be put in place so that intermediary organization like the rural banks, savings and loan companies, susu operators do not siphon the money into other uses.