Microcredit association chair blames weak lender risk assessment for loan defaults
Benjamin Turkson Junior, the National Board Chairperson of the Micro Credit Association Ghana, says weak risk management leads to loan defaults. He told an interview at an Annual General Meeting in Ho that lenders must improve how they assess borrowers. He wants financial institutions to better evaluate creditworthiness before approving loans. Turkson argued that lenders should take more responsibility for ensuring customers can and will repay their debts.
The National Board Chairperson of the Micro Credit Association Ghana, Benjamin Turkson Junior, has attributed loan defaults in parts of the microcredit sector to weak risk management systems among some lending institutions. He has urged financial institutions to strengthen their assessment of prospective borrowers and establish effective mechanisms to evaluate their creditworthiness before approving loans. Speaking in an interview at the Association’s Annual General Meeting in Ho, Mr Turkson argued that lenders must take greater responsibility for ensuring that loans are advanced to customers with the capacity and willingness to repay. “I have always personally developed a philosophy where I say we don’t have bad borrowers, but we have bad lenders,” he said.