Journal of Microfinance / ESR Review


Napoleon Bamfo


One option of development that governments in Africa can pursue but which does not appear to have crossed their minds, is encouraging towns, represented as incorporated units, to borrow financial credit. There are several reasons why this appears to be a viable option of development. No government has the financial capacity to address the social and developmental needs of every town under its jurisdiction. A government that encourages or makes it easy for individual towns to utilize credit available from financial institutions, therefore, will be opening a hitherto underutilized component of development in the form of local savings and entrepreneurship in addressing the particular needs of communities. That the constant demands of several communities on government for developmental assistance will be substantially mitigated will also be complemented by the fact that the simultaneous engagement of several towns in myriad development projects may be the most cost-effective way of accelerating economic development. This paper examines a developmental option that could potentially relieve poverty in Africa by examining the feasibility of making townships the primary recipients of financial credit and offers a look at the problems that might be associated with pursuing that policy.



Journal Title

Journal of Microfinance

Issue and Volume