OUTREACH AND SUSTAINABILITY OF INVENTORY CREDITPROGRAMME IN GHANA

The study examined the outreach and sustainability of the inventorycredit programme (ICP) in Ghana using both qualitative and quantitative databetween 1996 and 2003. The findings revealed that the outreach of the ICP reachedthe poor with a depth of 25-47% (nationwide) measured in terms of loan size/GNPper capita. The outreach measured in terms of percentage of female clients servedwas initially 20%, but fairly increased to 59% over the study period. However, acomparative analysis with two successful MFIs in Ghana and standardisedperformance benchmarks indicate that the ICP did not perform well in reaching thevery poor. The results of the financial performance indicate that the ICP wasoperationally and financially sustainable. Further, the study showed that the ICPhad high loan recovery rate which underlies its profitability. However, the ICPoperated with a low efficiency measured in terms of adjusted operational expensesratio. Based on these findings the study concludes that there is a trade-off betweenoutreach to the poorest and a financial sustainability of the ICP which can bemitigated by the enhanced credit allocation through lower cost structures.