European Academic Research ISSN 2286-4822
ISSN-L 2286-4822
Impact Factor: 3.4546 (UIF)
DRJI Value : 5.9 (B+)
Article Details :
Article Name :
Institutional Entrepreneurship in Ghana’s Informal Microfinance Institutions
Author Name :
Charles Hackman K. Essel, Min Wang, Edwina Oheneasi Essel, Lydia Asare-Kyire, Dennis Fiifi Darko
Publisher :
Bridge Center
Article URL :
Abstract :
This paper demonstrates how Microfinance institutions (MFIs) in Ghana have acted as institutional entrepreneurs in the in bringing change in the financial industry. Based on a qualitative case study (spanning January – June, 2016) of selected MFIs operating in 3 regions (Greater Accra, Eastern and Ashanti) of Ghana we follow a non-participant observation method at the community levels where customers and key informant interviews were conducted. We analysed the secondary data regarding the study. Our findings revealed that majority of the stakeholders embraced and transacted business with the MFIs especially in the rural and sub-urban settlements than in the urbanized areas. Key community or social stakeholders were engaged as part of the community entry strategy at the initial stages to gain legitimacy and acceptance. Customers are essential part of product/service design, implementation phases by the MFIs. The alternative use of group security in place of the traditional collateral to secure loans emphasized the relationship and trust among the players. The MFI practice as institutional entrepreneurs has diffused into the mainstream financial players and is evidenced in the adoption of MFI portfolios, inversely, the technological and processes within the traditional players have gained prominence in the practices of most MFIs giving it a two-dimensional interplay. These findings show how innovative MFIs have emerged to fill the demand gap created within the scope of the financial institutions logic leading to its legitimacy in Ghana.
Keywords :
Microfinance Institutions, Institutions, Institutional Entrepreneurs, Legitimacy, Ghana

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