Recent data from the Bank of Ghana Collateral Registry on the gender distribution of secured loans shows a stark contrast in loan access between men and women, revealing significant disparities in the financial landscape.
According to the breakdown, individual male borrowers and businesses owned by men overwhelmingly dominated the secured loan market in the second quarter of 2024.
Individual females and businesses owned by women accounted for GHS 1.1 billion in secured loans, marking a 42.6% increase from GHS 781.4 million in Q2-2023.
On the other hand, men and male-owned businesses saw their secured loans rise dramatically from GHS 2.2 billion in Q2-2023 to GHS 4.9 billion in Q2-2024, a 122.7% increase.
This surge resulted in men holding an 81.7% share of the total value of secured loans in Q2-2024, up from 37.3% in the previous year. Women’s share also grew but was significantly lower, increasing to 18.3% from 13.1% during the same period.
Secured loans granted to individual female borrowers and female-owned businesses saw a remarkable 71.4% increase, reaching 70,980 loans in Q2-2024, compared to 41,413 loans in Q2-2023.
In contrast, male borrowers and male-owned businesses recorded a modest 5.6% increase in secured loans, from 8,827 in Q2-2023 to 9,318 in Q2-2024.
Consequently, women now account for 88.4% of the total volume of secured loans, with men holding just an 11.6% share in Q2-2024.
This means that while men have greater access to loans in terms of value, women lead in the number of loans secured.
The report also raises important questions about the financial inclusion of women and the barriers they may face in accessing substantial credit. Despite their numbers and entrepreneurial presence, the significant gap in the value of loans between men and women indicates a need for targeted financial products and policies that can bridge this divide. Addressing this disparity could unlock more opportunities for women, potentially leading to broader economic growth and stability.
Research shows women entrepreneurs in Ghana continue to face challenges in securing loans, some of which include: limited access to start-up capital and high borrowing costs that hinder their ability to launch and grow businesses, with many lacking collaterals due to cultural norms regarding land ownership, impacting their ability to secure loans.
Cumbersome registration processes of businesses also contribute to the challenge women entrepreneurs face in Ghana, the high costs in registering their businesses complicate their entrepreneurial efforts.
Inadequate government support and capacity development for women in business equally limits their growth potential.
Other factors included the balancing of responsibilities with regard to cultural settings, which place heavy responsibilities on women, making it difficult to balance work and family life.
Women according to the Master Card Foundation, dominate Ghana’s informal sector, ranking as the highest globally at 46%.
