Microcredit in the Volta

Nicholas Kristof’s editorial on microcredit in the New York Times last week reminded me that I’ve been wanting to post about a microfinance organization here in Ghana, Lumana Credit.

With 700 clients mostly in the Volta Region of Ghana, Lumana is a relatively small organization, but it’s grown fast since it was founded just four years ago by Seattle native Sammie Rayner. In 2008, Sammie first visited the town of Anloga in the Volta Region. In just a few months, she put together a pilot project that served 30 entrepreneurs, a project that became the basis for Lumana’s success.

View of a lagoon near Anloga

The area around Anloga is in a low-lying plain near the ocean with beautiful lagoons.

I met one of Lumana’s co-founders, Cole Hoover, and their Director of Operations, Justine Levesque, on a mutual friend’s balcony one evening in April, and promptly invited myself out to see what they were up to. A few weeks later, I was taking my first long motorbike trip out to see them, complete with a friend on the back and payment of the requisite bribe at a police barrier. (It was an unusual bribe, however: half a watermelon and three cedis. Why watermelon? The Volta seems like the place where all watermelon come from; there are piles of them for sale along the road for miles. We couldn’t resist. And neither could the police.)

Lumana is based in Anloga, a village in the beautiful south of the Volta region, about two and a half hours by motorbike from Accra. It was a beautiful area, and though I didn’t get a chance to meet many of their clients, I could see from the many lengthy greetings on our trips around town that they are well-known and well-loved by the community. You can meet some of Lumana’s clients on their website.

"Melody Praise Financial Services"

Lumana’s competition?

They did, however, show me a great time:

Meet Me There Hostel

We visited a hostel nearby called Meet Me There, which is run by a group of Brits. Not surprisingly, it’s chock full of characters. They have a private lagoon and on the other side of the sand is the ocean.

Dzibodi bar

The local “spot” (bar): Dzibodi. It’s pronounced like the country Djibouti (Jah-booty).


We cooked an epic brunch the next morning….

Justine told me they were especially excited about their plans to fund a larger-scale project for a man named Cena, who bottles tomatoes. With his new canning facilities, he will be able to produce many times more tomatoes to supply local schools during the dry season, when fresh tomatoes, a staple of Ghanaian cuisine, are in short supply.


Farming…Lumana funds some small-scale farmers in the region, though most of their work focuses on women who have trades such as sewing or food preparation. I saw a lot of folks up early, hauling buckets of water from wells for irrigation. This irrigation system was the most advanced I saw.

I’ve been rather infatuated by microfinance since 2005, when Dr. Rangaswamy Rajagopal, and University of Iowa professor, enthusiastically introduced my environmental policy class to the concept. Always excited and always inspirational, I distinctly remember Raj waving his hands and telling us about Muhammed Yunus’ brilliant idea to give a small loan to one of the women selling petty goods near where he worked. I was fascinated by the idea, and intrigued by Yunus’ bold assertion that credit is a human right.

Raj took me and a small band of Iowa students on a trip to India later that year to study a microfinance institution based in Tamil Nadu. Like Yunus, they used a group solidarity method to secure the loans; all members of the group agree to pay the debts of any other member who defaults, creating peer pressure to repay the loans. And because of data showing that women are far more likely to repay their loans and use the extra income for the benefit of the family, they loaned exclusively to women’s groups.

Lumana is fairly similar in approach, but though their clients are mostly women, they do also loan to men. They also help their clients save money and give them business education and mentoring. Their interest rates – about 24% – may seem steep, but they’re in fact quite low for the industry: without microcredit institutions, these borrowers would have to resort to loan sharks who charge 60-80% or more on their loans.

Microfinance is nothing new to Ghana: Yunus’ Grameen Bank is active here, among many others, but there is still a huge amount of unmet demand. Despite the negative effects that the recent decline in the value of the Ghana cedi has had on the economy, Lumana is still doing well and even expanding. They’ve set up an office in Accra to handle the microfinance clients they’ve absorbed from other institutions who haven’t fared as well. (Which means I get to see them a lot more often!) And as recent development literature has pointed to the importance of small and medium enterprises to economic growth, they are starting to focus on more clients like Cena, who can scale up and employ people as they grow.

My visits to Lumana have made me fall in love with the southern Volta; I can see why they like it there:

Keta Beach…the beach is actually really steep here, which creates a wicked (but exciting) undertow. Swimming is an adventure.

Wedding at Keta beach

Women dressed up for a wedding party at the beach.


Football in a churchyard

Doctor Garlic

Doctor Garlic. Herbal and traditional medicine are still widely used in Ghana; sometimes as a supplement and sometimes as a substitute for modern medicine.

Military House

Military House.

Lest we forget the history of the slave trade on the Gold Coast…



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