Minister bemoans the mismanagement of personal loans

Bunso (E/R), July 5, GNA- Mr Yaw Barimah, Eastern Regional Minister, has observed that the difficulty in recovering small loans stemmed from the fact that beneficiaries of such loans usually mismanaged it. He explained that since small loans were granted to people in the informal sector, paying back the loans becomes difficult because most of the beneficiaries did not put it into income generating ventures that would enable them to pay back.

Mr Barimah called on institutions granting small loans to the informal sector to be interested in the activities of the beneficiaries by monitoring them and ensuring that the money is used for the purpose for which it was taken.

Addressing a two-day orientation course for Financial Extension Assistants (FEA's) recruited under the Micro Assistance and Small Loans Centre (Masloc) at Bunso on Thursday, the Minister reminded the participants of government's commitment to poverty reduction in the country.

The 180 FEA's were drawn from the Volta, Central, Eastern and the Greater-Accra regions.

He said government had realized the need to create an opportunity for the informal sector to have access to business capitals in the form of small loans, hence the establishment of the Masloc to strengthen the objectives of poverty reduction in the country.

Mr Barimah called on the public to be vigilant in reporting persons whose activities were undermining the credibility of the programme to ensure that the purpose of the scheme was achieved.

He cited an instance where he personally had to intervene to stop some people from defrauding innocent people under the pretext of granting loans to them under the masloc.

The Chief Executive of Masloc, Dr John Agyekumhene said the aim of the masloc was to provide banking service to the poor who had no access to the banks and urged the FEA's to carry the service closer to the needy people.

He advised the trainees to justify the confidence reposed in them by working hard, adding that their performances would guarantee a renewal of their yearly contracts.

Dr Agyekumhnene cautioned that Masloc would deal with any FEA's whose activities undermine the objective of the programme. On his part, the Eastern Regional Coordinator of the Masloc, Mr. Dominic Baah-Ayim, said their operations were purposely for the poor since loans granted required no collateral.

He said the participants were taken through, the mandate and objectives of masloc, group dynamics and eligibility and functions of the FEA's for the success of the programme.