Lending corruption and bank loan contracting: implications for gender inequity and inclusive growth in West Africa

The research project examined the impact of lending corruption on small- and medium-sized enterprises (SMSEs) in Ghana and Nigeria, with a particular focus on women entrepreneurs.

The banking and finance sectors are essential for economic growth, providing services such as deposit collection and credit to individuals and businesses. However, lending corruption significantly affects loan quality and financial performance, making banks vulnerable to instability, especially during economic downturns. Given the need for economic diversification in Ghana and Nigeria due to their reliance on natural resources, understanding the factors contributing to lending corruption is essential for promoting sustainable growth.

Using Nigeria and Ghana as case studies, the empirical study aimed to illuminate how corrupt lending practices affected loan contracts for women entrepreneurs and their implications for inclusive growth. It explored how early-life-cycle gender-related lending corruption could adversely influence entrepreneurial development.

The project adopted a mixed-methods approach, employing three main data collection instruments: 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.

Ultimately, the findings aimed to inform policymakers and business leaders about the interplay between lending practices, gender, and economic growth, promoting strategies that could enhance credit access and foster a more inclusive economic landscape.

SOAS-ACE is currently undertaking research in Bangladesh and Nigeria, including in the education, health and power sectors, as well as on successful collective action that overthrew a corrupt autocracy. Moving beyond pure research, we are also monitoring the implementation of anti-corruption strategies our research has recommended, such as a strategy to reduce pharmaceutical companies’ overpricing of medicines.

Our partners on this project were: research partner – Auburn University; principal investigator – Dr Kelly Krawczyk (Auburn University), and co-principal investigators – Dr Hayford Nsiah and Brian Ezeonu (Auburn University).