Conceptual Framework for Enhancing the Implementation of Specific Microfinance Policies in Sub-Sahara Africa

Conceptual Framework for Enhancing the Implementation of Specific Microfinance Policies in Sub-Sahara Africa

Kwami Hope Quao (Abersytwyth University Mauritius, Uniciti, Mauritius)
Copyright: © 2019 |Pages: 13
DOI: 10.4018/IJRDIS.2019010103
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Deficient policy formulation processes and inadequate monitoring and supervision remain factors impeding the growth of microfinance in sub-Saharan Africa. This article explores issues mitigating policy implementation for microfinance institutions to propose a framework that will integrate stakeholders in the microfinance sector for effective financial policy implementation and promotion of microfinance performance and growth. The article proposes financial monitoring policy ownership structure and argues for the creation of an independent national microfinance supervisory authority as an alternative to ensuring effective implementation of microfinance policies in Ghana. This framework, the authors argue, will enhance stakeholder engagement in police formulation and create the necessary implementation environment, with adequate information, in which policy implementation for microfinance will flourish.
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Literature Review

Empirical review presented considered MF regulation and implementation strategies in SSA and is interspersed with policy formulation theory and process, implementation theory and environments as well as a number of relevant policy implementation models.

Policy Formulation Theory and Process for MFIs

Many authors define policy formulation at two broad levels: problem identification and definition which Embrett & Randall (2014) refer to as the agenda setting stage and actual formulation; including decision-making and implementation and evaluation stages. Santos (2012, p. 339) however indicates environment specificity approach to policy making. Similarly, Embrett & Randall (2014) aver policy formulation for microfinance should be random and erratic yet country specific (CGAP, 2011) as MF activities are complex; dictated by the environment that creates them (Santos (2012).

The complex activities of MF correlate with Little (2012, p. 16) and Geyer’s (2012) call for the complexity theory of policy formulation (Hallsworth & Rutter, 2011, p. 18; Cairney, 2012, pp. 1-14) which intimates that policy formulation should be regarded as a system. Therefore, policymaking involves many ideas interacting in a non-linear fashion (Smith & Katikireddi, 2012; Embrett & Randall, 2014); drawing cooperation from policymakers and implementers to ensure that those interactions (Geyer, 2012) can produce new ideas and ways of thinking (Pritchett et al., 2012).

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