Research partner: Auburn University

Principal investigator: Dr Kelly Krawczyk (Auburn University) 

Co-principal investigators: Dr Hayford Nsiah and Brian Ezeonu (Auburn University)


The banking and finance industries play a major role in fostering development through their provision of access to credit. The access conditions to bank loans therefore play a decisive role in the revitalization and development of small‐ and medium‐size enterprises (SMSEs) in developing countries in West Africa such as Nigeria and Ghana. By collecting deposits and providing credit to individuals, families, and businesses, the banking system is often regarded as the lifeblood of many economies and is very instrumental to growth. Yet, lending corruption is a key agency problem for banks. Banks in countries with more lending corruption have poor loan quality, worse earnings performance, and are more susceptible to trouble during a financial crisis. This issue is considered crucial in Nigeria and Ghana, where economic diversification is critical to reducing vulnerability to external shocks driven by the economy’s over‐dependence on natural resources. 

Most studies on corruption have focused on the public sector, given it plays a significant role in providing an enabling environment for businesses, but recently private sector corruption is becoming a major research area. While governments are responsible for creating a good business environment, private sector corruption has the potential to stifle the outcomes of government interventions.

Using Nigeria and Ghana as case studies, this empirical study seeks to examine how lending corruption affects loan contracts of women entrepreneurs and its implications for achieving inclusive growth in West Africa.

Why the banking sector?

The banking sector plays an important role in the Nigerian and Ghanaian economy through its provision of financial services that stimulate savings and investment for economic growth. The sector’s provision of access to credit also bolsters entrepreneurship and helps small businesses expand. Nigeria and Ghana are entrepreneurial economies with an estimated 37 million micro, small and medium‐sized companies, whose contribution to economic growth and job creation is significant, however, less than a third of the SMSEs in these countries have successfully obtained a loan from a financial institution (World Bank 2017). Therefore, lending corruption, if not effectively tackled, impacts business growth and entrepreneurship negatively while also disenfranchising marginalised groups, such as women, from the credit market.

The research project

The study will explore early‐life‐cycle gender‐related lending corruption in bank loan contracting which may have long‐lasting effects on entrepreneurial development and growth. The research will adopt a mixed methodology utilising three instruments in its approach: 1) a survey questionnaire designed to capture women entrepreneurs’ experiences with lending corruption, 2) In‐ depth interviews will be conducted with bank executives on their lending practices and 3) a contextualised qualitative interview for key informants.

This research project is one of nine projects from our grants scheme that aim to tackle corruption in the private sector.


Public Goods &

Productive Sectors


Governance Agencies