Ghana’s economy has gradually improved over the past two decades, partly due to the Economic Recovery Programme (ERP) that was implemented in 1983, and partly due to additional poverty alleviating strategies such as effective microfinance programmes that have been executed by the Government and international agencies working in the country. In fact, microfinance was identified by the Government of Ghana as one of the most efficient instruments in fighting poverty, and consequently improving poor people’s potential to increase income and employment opportunities, especially among women. Over the past years, the number of sustainable, independent MFIs has increased remarkably with the active support of donors and the Government.

On their part, UNCDF and UNDP launched the MicroStart Ghana Project as a component of the global MicroStart pilot programme in 1998, with the parallel objective of supporting selected partner MFIs build institutional capacity in order to assist them in scaling-up outreach, while achieving managerial and financial sustainability. An amount of US$1,600,000 was provided for Phase I of the project to be used by the MFI partners in the programme for the purpose of providing on-lending services, especially to women, on a permanent revolving fund basis. After a three-year period, the 5 participating organizations were serving 84,651 clients against the targeted number of 77,053 by end of the programme; had mobilised savings in the amount of $2,050,000 as against the December 1999 baseline data savings of $600,000; and had achieved a total loan portfolio of $2,300,000 compared to the $570,000 at the start of the project. Presently, in keeping with the new Millennium Development Goals, UNCDF and UNDP are shifting their focus from individual MFIs to sector related issues with increasing emphasis placed on developing the micro finance sector as a whole through appropriate, sector wide strategies. Consequently, Phase II of the MicroStart programme in Ghana will direct its efforts in supporting the microfinance sector whereby the sustainability of financial services for the lower segments in the market will be developed as an integrated part of the financial sector in Ghana.