The Microfinance Insider is a forum for graduate students engaged or interested in working in the field of microfinance. Through weekly posts and comments we hope to inspire students and foster the creation of a knowledge community of bloggers with a commitment to financial access and first hand industry information.

Saturday, August 2, 2008

Expanding Financial Literacy

The need for financial literacy training and business-skills development is widely acknowledged by nearly every microfinance institution that offers savings and loans products. Seminar series and one-time workshops are offered by most of the MFI giants, including ACCIÓN International and New York as well as partner-MFIs of the Grameen Bank. Fellow FAI-blogger Thea Garon recently noted the importance of financial education in improving the financial lives of the unbanked in New York City. Financial literacy is equally important for the informally banked in Ghana, yet it is not a part of the traditional services offered by the susu-banking industry.

On the first day of my internship with the Microfinance and Community Development Organization (MFCDO), the executive director, Godwin Ofori-Atta, and I discussed what I might do in my two months with the organization. Knowing that this NGO has several programs and projects centered
around microfinance activities—including an intensive development training program for women, a soon-to-be-inaugurated microfinance school, and a susu-banking agency (for small-scale savings, see June 17 post)—I was excited by the opportunities at my fingertips. After Mr. Godwin Ofori-Atta explained the timeline of current and upcoming programs and the organization's plans for seeking funding for some of their programs, I suggested that we hold a series of financial literacy workshops through the susu-banking agency, the Open Heart Solutions Agency.
Above right, MFCDO Director Godwin Ofori-Atta reviews the details of a savings plan to susu clients.

With the assistance of the MFCDO office staff, I embarked on the task of implementing two financial literacy workshop series: one for susu agents, and one for susu clients. The first
step in organizing these workshops was to determine the needs of each group. What do susu agents, the daily collectors of small savings, need to know in order to better serve their
clients? What do susu clients, as petty traders in the market, need to learn about basic banking and business expansion in order to save more or use a loan more efficiently?

To answer these questions, I talked to the office staff and accompanied the susu-agent supervisor, Florence, on her daily rounds to each of the 20 susu agents. I learned that susu agents were unclear on the principles of credit and debit and interest rates and that susu clients wished to work on basic record keeping and ways that they could expand their trade. The initial survey administered (unscientifically, I must admit) to susu clients indicated that the majority was unaware of some of the microfinance products offered by their susu agency.

Directed by this mini-investigation into the needs of both employees and clients of the agency as well as my own observations of activity in the market and the microfinance sphere, I outlined agendas for the first workshops for the agents and the clients. The first agent workshop, which was held on a Saturday morning, focused on an in-depth review on the products and services offered by the agency, and also included lessons on customer service, credit and debit, and a review of the redenominated currency which set 10,000 Ghana cedis to one new Ghana cedi (while the Ghana cedi was redenominated over a year ago, in July 2007, many Ghanaians still conduct financial transactions with verbiage of the old currency). The first workshop for the clients focused on lessons in bookkeeping and the redenomination of the cedi, and it included a session on the financial products and services offered and ways that a loan can be used for business expansion. Both workshops included a presentation by an office-staff member, role-playing to practice products presentation (for susu agents) and financial transactions in the new Ghana cedi (for both agents and clients), and skills development in small groups of three to four individuals.

Once the agenda was set (and reviewed and approved by the office staff), I created the necessary materials, worked with Florence (the susu-agent supervisor) so that she felt comfortable leading some of the lessons, and held a dress rehearsal the day before each workshop. While the director mandated that the susu agents attend their respective workshop, Florence and the other office-staff members and the susu agents were vital in advertising the workshop for the clients. Above, Florence presents to susu agents.

Above, susu-agent Auntie Hope clarifies the details of a loan product.

Susu agents Dufua and Tommy practice presenting a MFCDO financial product.

Susu clients attend a financial literacy workshop.

Both first workshops were quite successful—even a bit more than I had expected!—and the agents and clients seemed to think that they were a worthwhile activity. As follow up and to serve as a guide in planning the agenda for the next workshops, I distributed workshop feedback forms to all attendees. There has been talk among susu clients that did not attend the workshop of wanting to a chance to participate in such an activity. I am eager to see how this workshop series will develop for the Open Heart Solutions Agency!

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