Women’s World Banking (WWBG)
PO Box 2989
Accra, Ghana
Mr. T.A. Dawson-Otoo, Savings and Credit Manager
Male/Female staff. Has 7 branches: two in Accra, two in Kumasi, one in Tema, one in Madina, one in Takoradi.
They provide loans and business-related services for women. The idea of this bank came from “12 strong women, including two Ghanaian women, who met at the 1975 World Conference on Women in Mexico. Mrs. Esther Ocloo was one of them. They organized the bank to provide loans to poor, informal sector, women and business who were being ignored by the financial institutions.” Most of their clients are traders and market women. They started also giving loans to men in small-scale business. WWB New York is the parent company. It has 40 affiliates in developing companies, from this idea that was begun in Mexico City in 1975. They initially went to Barclay’s Bank, Ghana, with a guarantee by WWBNY. However, Barclay’s was difficult, so it was necessary for WWBG to do direct lending. WWBG formalized the “su su” system (informal savings system) where women saved for 6 months and used that savings for collateral for loans. The loans are a multiple of savings, with some support from the bank. WWBG began as a NGO in 1983. Became operational in 1988. In 1991, it began the savings scheme.
WWBG began with a focus on entrepreneurial development training programs. They soon realized that women needed financial assistance to put the training into practice.
He showed McDade a spread-sheet where they had monthly projections of their loan portfolio. They had a list of their targeted number of clients and actual number of clients. At each of the major markets in Accra, for each market, the actual number of clients was less than the projected number. For example at Makola market, one of the largest markets in Accra, the projected number was 95, the actual was 26. The reason for this is that women are reluctant to borrow when the interest is so high. Their interest rate is below the market rate, and it’s still at 38%. They pay 15% interest on savings. They have 19,000 clients in Ghana at an average savings of 20,000-30,000 cedis a week.
How does the WWBG compare to the “su su” system? He said that the loan to savings ratio was constrained by the Bank of Ghana regulations. They must follow the banking regulations, even though they are a small lender.
WWBG also invests in treasury bills, etc., to spread their risk. They have outstanding current loans, 2.5 billion cedis. They plan to add another 3 billion in loans, but are constrained due to liquidity. At the end of the year they’d like to have given out 4 billion cedis in loans. Repayment has been good: it ranged from 99% repayment in May. At times it has been an average of 76%, which is considered low. In 1995, the number of loans that were defaulted was 36%.
McDade asks him if they were similar Grameen Bank in Bangladesh. He says “culture counts a lot in the Grameen system. The pressure to pay transparency. It’s not the same in Ghana, it’s difficult to get women in business to organize together. This is what we’re trying to do now. Fortunately for us, we’ve had a sponsor to send staff members to Bangladesh to study the Grameen system.”
There has been a rapport with women’s interest among WWBG staff. When we started, it was mostly women who we loaned to. Now men are given loans and technical support services. 20% of the loans are to men. (Although there were both men and women lenders, the majority of the professional staff seemed to be men. However, in the “su su” informal system, the men were the ones collecting the money.)
Microfinancing is very expensive. We have to go out everyday. We may have to raise our interest rates. If we don’t, we will not be able to meet our operating expenses.