Financial Stress Plagues 64% of Working Ghanaian Population, Reveals Study

According to a recent study by our source, a staggering 64% of working Ghanaians are facing financial distress. The situation is particularly dire for those earning less than GH3,000 per month and employees in the informal sector.

Decreased Income and Increased Reliance on Savings

Our research indicates that a large proportion of Ghanaians are earning lower salaries than they were in the pre-2022 period. Consequently, many have been forced to dig into their savings to meet daily expenses, leaving them devoid of a financial safety net. However, unlike most assumptions, instead of resorting to formal loans, most individuals prefer borrowing from acquaintances or opt for traditional savings methods such as ‘Susu’.

Mismatch Between Formal Savings and The Masses

Albeit, a substantial number of the population use varied channels such as banks and mobile money platforms for savings, there’s growing skepticism regarding their appropriateness, affordability, and reliability. There’s a clear disconnect between what the financial services industry offers and what the people trust or can access. This further emphasizes the need for increased financial literacy and accessibility.

Priority of Saving Goals

Our research discloses that the priorities of Ghanaians are heavily skewed towards saving for income security, emergency funds, their children’s education, and for their family’s future. Retirement planning, however, takes a back seat. The survey reveals only 37% have started saving for their retirement, pointing towards a need for greater awareness and facilitation in this domain.

Aversion to Formal Borrowings

An intriguing revelation of the study is that a considerable number of respondents who own businesses tend to self-finance them. There’s an observable aversion to formal borrowing, indicative of people’s inclination to maintain control and avoid potential risks associated with loans.

The Shortage of Employee Benefits

Compounding the financial problems, a significant number of workers in the formal sector do not receive employee benefits. Of the minority that do, medical insurance and pension funds top the list. The absence of a complete benefits package adds to the financial strain on working Ghanaians, hinting at the urgent need for changes in current employment practices.