Project Management and Sustainability of Microfinance Institutions in Ghana: An Empirical Assessment

International Journal of Research and Innovation in Social Science (IJRISS) | Volume III, Issue V, May 2019 | ISSN 2454–6186

Project Management and Sustainability of Microfinance Institutions in Ghana: An Empirical Assessment

Dankwa, Ernest Akwasi Adom

Faculty of Business Studies, Garden City University College, P.O. Box 12775 Kumasi-Ghana

Abstract: – The rampant collapse of several microfinance companies in Ghana is a worrying phenomenon that needed thorough investigations. Due to the fact that project management enables businesses to plan and execute tasks and responsibilities effectively, within time and budgetary constraints, it has become an important management tool for successful enterprises. However, literature gap with regards to project management tools application on MFIs sustainability exist, motivating the author to investigate the role of project management in ensuring the sustainability of microfinance institutions in Ghana. Using a quantitative research method, data were collected from 10 MFIs in Western and Ashanti regions of Ghana. 30 respondents were purposively sampled to enable inclusion of microfinance companies deemed to be thriving and those perceived to be on the brink of failure. A simple linear regression model, coefficient and chi-square test were used. The paper documents that using project management principles and techniques has significant positive impact on business management, business expansion and business sustainability and therefore recommended that managers of MFIs must adopt project management principles in the management of firms and task themselves to ensure prudent economic management in all facets of their endeavors.

Keywords: Microfinance Institutions (MFIs), bankruptcy, project management, sustainability

I. INTRODUCTION

Microfinance institutions are typically mission driven organization set to provide access to finance services to poor families and SMEs in developing economies RandØy et al (2014). This was confirmed in in an earlier study in Ghana by Mensah (2004) that saw microfinance industry as the biggest financier of small and medium scale enterprises, accounting for 90% of all SME loans and credits. Biosca et al (2014) and Ahmed & Chowdhury (2007) posit that the contribution of the microfinance sector to small and medium-scale enterprises (SME) is immense, ensuring that the SME sector serves as the engine of national economic growth, making up 90% of all business ventures and employing up to 60% of the national population. Due to this telling contribution of the microfinance sector to the growth and sustainability of small companies and poor individuals and the subsequent contribution of SMEs to the national economy, it is imperative that the microfinance sector is supported to be sustainable and prosperous

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