Prof John Gatsi Writes: Commercial Bank And Women’s Development Bank Are Not The Same
The concept of a Women’s Development Bank is not new globally. It has been established in countries such as India to internationally support women entrepreneurs to create and sustain enterprises and to deal with poverty.
It has been established that generally, micro small, and medium-sized enterprises (MSMEs) established and managed by women have the chance of survival to grow and provide jobs.
As part of growing the participation of women in enterprise and scaling up the contribution to economic growth and increase job creation opportunities to tackle the security-laden unemployment.
The promise by John Mahama and Jane Opoku Agyemang to establish a Women’s Development bank is timely and perhaps thoughtful. A Women’s Development Bank is an intentional strategy to economically empower women in the country to get access to long-term credits at either zero interest or lower interest rates than commercial banks.
Development banks in general are different from commercial banks. The latter grants mostly short-term loans with high interest rates putting the burden on recipients. This creates a great interest burden and difficulty for the growth of business.
The best way to reduce poverty drastically is through the provision of development credits to women entrepreneurs.
Normally, since the Women’s Development Bank is a special class of development bank, it normally receives seed money from international development and financial institutions, domestic governments, foreign governments, foundations, and NGOs.
There are people who are concerned about the zero-interest or low-interest charge by indicating concern about the survival of the bank. We have even seen some lending development facilities in agriculture and other sectors through the normal commercial banks.
In such a case the interest rates are very low. So the setup and operation of a development bank is different from that of a commercial bank. The zero-interest loan portfolios of the development bank will attract interest from the Islamic Development Bank.
Some people also say why women? Is it not discriminatory? We have been dealing with women empowerment, equality, and inclusion in leadership for a long time.
This was given a boost by Beijing in 1995. Truth be told we still have a long way to support our women to fight poverty and enhance their entrepreneurial opportunities. We do all these for ourselves.
When a woman is able to develop an enterprise, the benefit is not to her alone, her children, husband, and other family members are the real beneficiaries.
A Women’s Development Bank creates the opportunity to increase the productivity of women.
