The Credit Policies and Credit Finance Creation Practices by Commercial Banks in Ghana: Perspectives of Staff and Clients of the Prudential Bank Limited

John Kwaning Mbroh; Kwesi Asiedu Koomson

doi:doi:10.11648/j.ijefm.20150305.15

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The Credit Policies and Credit Finance Creation Practices by Commercial Banks in Ghana: Perspectives of Staff and Clients of the Prudential Bank Limited

John Kwaning Mbroh, Kwesi Asiedu Koomson

Published in International Journal of Economics, Finance and Management Sciences (Volume 3, Issue 5)

Received: 21 August 2015 Accepted: 30 August 2015 Published: 12 September 2015

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Abstract

Commercial banks play a crucial role in credit financing of individuals, institutions and generally, their clients. They use a system of credit management to govern their operations in this regard. Specifically, they do this through established credit policies or systems and to an extent, the relevant policy determines a given quantum of credit finance on case-by-case basis but most importantly, whether or not to grant the credit finance request upon assessment. Conveniently sampling the perspectives of both credit officers (15) and customers (67) of the Prudential Bank Limited, primary and secondary data sources were used, with the primary data obtained through unstructured interviews and two sets of self-administered questionnaire for the respective respondent-categories. The findings reveal that both categories of respondents recommend the need for the bank to decentralise its credit finance application processing and approval system. Due to the bank’s existing credit policy, customers had to wait, on average, one month for the approval or otherwise of their requests, with the salaried-worker customer-group granted more credit finance than the others. Also, the bank had granted more credit in the form of loans. Sadly, business persons and other categories of customers were waiting three months for response to their credit finance requests. The customers and their bankers disagreed in their respective perspectives regarding the main reason(s) for granting or declining credit finance requests as well as on matters of collateral security. Among others, the study recommends the shortening of credit facility processing time to enhance the bank’s competitive drive in the banking industry and also to make these facilities more responsive to the needs of the customers. Future research is expected to conclude on the extent of impact that banks’ credit policies have on their credit finance creation.

Published in	International Journal of Economics, Finance and Management Sciences (Volume 3, Issue 5)
DOI	10.11648/j.ijefm.20150305.15
Page(s)	441-452
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2015. Published by Science Publishing Group

Keywords

Credit Policy, Credit Finance Creation, Credit Officers, Customers, Prudential Bank Limited (PBL)

References

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APA Style

John Kwaning Mbroh, Kwesi Asiedu Koomson. (2015). The Credit Policies and Credit Finance Creation Practices by Commercial Banks in Ghana: Perspectives of Staff and Clients of the Prudential Bank Limited. International Journal of Economics, Finance and Management Sciences, 3(5), 441-452. https://doi.org/10.11648/j.ijefm.20150305.15

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ACS Style

John Kwaning Mbroh; Kwesi Asiedu Koomson. The Credit Policies and Credit Finance Creation Practices by Commercial Banks in Ghana: Perspectives of Staff and Clients of the Prudential Bank Limited. Int. J. Econ. Finance Manag. Sci. 2015, 3(5), 441-452. doi: 10.11648/j.ijefm.20150305.15

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AMA Style

John Kwaning Mbroh, Kwesi Asiedu Koomson. The Credit Policies and Credit Finance Creation Practices by Commercial Banks in Ghana: Perspectives of Staff and Clients of the Prudential Bank Limited. Int J Econ Finance Manag Sci. 2015;3(5):441-452. doi: 10.11648/j.ijefm.20150305.15

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@article{10.11648/j.ijefm.20150305.15,
  author = {John Kwaning Mbroh and Kwesi Asiedu Koomson},
  title = {The Credit Policies and Credit Finance Creation Practices by Commercial Banks in Ghana: Perspectives of Staff and Clients of the Prudential Bank Limited},
  journal = {International Journal of Economics, Finance and Management Sciences},
  volume = {3},
  number = {5},
  pages = {441-452},
  doi = {10.11648/j.ijefm.20150305.15},
  url = {https://doi.org/10.11648/j.ijefm.20150305.15},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijefm.20150305.15},
  abstract = {Commercial banks play a crucial role in credit financing of individuals, institutions and generally, their clients. They use a system of credit management to govern their operations in this regard. Specifically, they do this through established credit policies or systems and to an extent, the relevant policy determines a given quantum of credit finance on case-by-case basis but most importantly, whether or not to grant the credit finance request upon assessment. Conveniently sampling the perspectives of both credit officers (15) and customers (67) of the Prudential Bank Limited, primary and secondary data sources were used, with the primary data obtained through unstructured interviews and two sets of self-administered questionnaire for the respective respondent-categories. The findings reveal that both categories of respondents recommend the need for the bank to decentralise its credit finance application processing and approval system. Due to the bank’s existing credit policy, customers had to wait, on average, one month for the approval or otherwise of their requests, with the salaried-worker customer-group granted more credit finance than the others. Also, the bank had granted more credit in the form of loans. Sadly, business persons and other categories of customers were waiting three months for response to their credit finance requests. The customers and their bankers disagreed in their respective perspectives regarding the main reason(s) for granting or declining credit finance requests as well as on matters of collateral security. Among others, the study recommends the shortening of credit facility processing time to enhance the bank’s competitive drive in the banking industry and also to make these facilities more responsive to the needs of the customers. Future research is expected to conclude on the extent of impact that banks’ credit policies have on their credit finance creation.},
 year = {2015}
}

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TY  - JOUR
T1  - The Credit Policies and Credit Finance Creation Practices by Commercial Banks in Ghana: Perspectives of Staff and Clients of the Prudential Bank Limited
AU  - John Kwaning Mbroh
AU  - Kwesi Asiedu Koomson
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PY  - 2015
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DO  - 10.11648/j.ijefm.20150305.15
T2  - International Journal of Economics, Finance and Management Sciences
JF  - International Journal of Economics, Finance and Management Sciences
JO  - International Journal of Economics, Finance and Management Sciences
SP  - 441
EP  - 452
PB  - Science Publishing Group
SN  - 2326-9561
UR  - https://doi.org/10.11648/j.ijefm.20150305.15
AB  - Commercial banks play a crucial role in credit financing of individuals, institutions and generally, their clients. They use a system of credit management to govern their operations in this regard. Specifically, they do this through established credit policies or systems and to an extent, the relevant policy determines a given quantum of credit finance on case-by-case basis but most importantly, whether or not to grant the credit finance request upon assessment. Conveniently sampling the perspectives of both credit officers (15) and customers (67) of the Prudential Bank Limited, primary and secondary data sources were used, with the primary data obtained through unstructured interviews and two sets of self-administered questionnaire for the respective respondent-categories. The findings reveal that both categories of respondents recommend the need for the bank to decentralise its credit finance application processing and approval system. Due to the bank’s existing credit policy, customers had to wait, on average, one month for the approval or otherwise of their requests, with the salaried-worker customer-group granted more credit finance than the others. Also, the bank had granted more credit in the form of loans. Sadly, business persons and other categories of customers were waiting three months for response to their credit finance requests. The customers and their bankers disagreed in their respective perspectives regarding the main reason(s) for granting or declining credit finance requests as well as on matters of collateral security. Among others, the study recommends the shortening of credit facility processing time to enhance the bank’s competitive drive in the banking industry and also to make these facilities more responsive to the needs of the customers. Future research is expected to conclude on the extent of impact that banks’ credit policies have on their credit finance creation.
VL  - 3
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Author Information

John Kwaning Mbroh

Dept. of Accountancy Studies, School of Business & Mgt Studies, Cape Coast Polytechnic, Cape Coast, Ghana
Kwesi Asiedu Koomson

KNUST CEMBA Program, KNUST Kumasi, Ghana

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John Kwaning Mbroh, Kwesi Asiedu Koomson. (2015). The Credit Policies and Credit Finance Creation Practices by Commercial Banks in Ghana: Perspectives of Staff and Clients of the Prudential Bank Limited. International Journal of Economics, Finance and Management Sciences, 3(5), 441-452. https://doi.org/10.11648/j.ijefm.20150305.15

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ACS Style

John Kwaning Mbroh; Kwesi Asiedu Koomson. The Credit Policies and Credit Finance Creation Practices by Commercial Banks in Ghana: Perspectives of Staff and Clients of the Prudential Bank Limited. Int. J. Econ. Finance Manag. Sci. 2015, 3(5), 441-452. doi: 10.11648/j.ijefm.20150305.15

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AMA Style

John Kwaning Mbroh, Kwesi Asiedu Koomson. The Credit Policies and Credit Finance Creation Practices by Commercial Banks in Ghana: Perspectives of Staff and Clients of the Prudential Bank Limited. Int J Econ Finance Manag Sci. 2015;3(5):441-452. doi: 10.11648/j.ijefm.20150305.15

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@article{10.11648/j.ijefm.20150305.15,
  author = {John Kwaning Mbroh and Kwesi Asiedu Koomson},
  title = {The Credit Policies and Credit Finance Creation Practices by Commercial Banks in Ghana: Perspectives of Staff and Clients of the Prudential Bank Limited},
  journal = {International Journal of Economics, Finance and Management Sciences},
  volume = {3},
  number = {5},
  pages = {441-452},
  doi = {10.11648/j.ijefm.20150305.15},
  url = {https://doi.org/10.11648/j.ijefm.20150305.15},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijefm.20150305.15},
  abstract = {Commercial banks play a crucial role in credit financing of individuals, institutions and generally, their clients. They use a system of credit management to govern their operations in this regard. Specifically, they do this through established credit policies or systems and to an extent, the relevant policy determines a given quantum of credit finance on case-by-case basis but most importantly, whether or not to grant the credit finance request upon assessment. Conveniently sampling the perspectives of both credit officers (15) and customers (67) of the Prudential Bank Limited, primary and secondary data sources were used, with the primary data obtained through unstructured interviews and two sets of self-administered questionnaire for the respective respondent-categories. The findings reveal that both categories of respondents recommend the need for the bank to decentralise its credit finance application processing and approval system. Due to the bank’s existing credit policy, customers had to wait, on average, one month for the approval or otherwise of their requests, with the salaried-worker customer-group granted more credit finance than the others. Also, the bank had granted more credit in the form of loans. Sadly, business persons and other categories of customers were waiting three months for response to their credit finance requests. The customers and their bankers disagreed in their respective perspectives regarding the main reason(s) for granting or declining credit finance requests as well as on matters of collateral security. Among others, the study recommends the shortening of credit facility processing time to enhance the bank’s competitive drive in the banking industry and also to make these facilities more responsive to the needs of the customers. Future research is expected to conclude on the extent of impact that banks’ credit policies have on their credit finance creation.},
 year = {2015}
}

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TY  - JOUR
T1  - The Credit Policies and Credit Finance Creation Practices by Commercial Banks in Ghana: Perspectives of Staff and Clients of the Prudential Bank Limited
AU  - John Kwaning Mbroh
AU  - Kwesi Asiedu Koomson
Y1  - 2015/09/12
PY  - 2015
N1  - https://doi.org/10.11648/j.ijefm.20150305.15
DO  - 10.11648/j.ijefm.20150305.15
T2  - International Journal of Economics, Finance and Management Sciences
JF  - International Journal of Economics, Finance and Management Sciences
JO  - International Journal of Economics, Finance and Management Sciences
SP  - 441
EP  - 452
PB  - Science Publishing Group
SN  - 2326-9561
UR  - https://doi.org/10.11648/j.ijefm.20150305.15
AB  - Commercial banks play a crucial role in credit financing of individuals, institutions and generally, their clients. They use a system of credit management to govern their operations in this regard. Specifically, they do this through established credit policies or systems and to an extent, the relevant policy determines a given quantum of credit finance on case-by-case basis but most importantly, whether or not to grant the credit finance request upon assessment. Conveniently sampling the perspectives of both credit officers (15) and customers (67) of the Prudential Bank Limited, primary and secondary data sources were used, with the primary data obtained through unstructured interviews and two sets of self-administered questionnaire for the respective respondent-categories. The findings reveal that both categories of respondents recommend the need for the bank to decentralise its credit finance application processing and approval system. Due to the bank’s existing credit policy, customers had to wait, on average, one month for the approval or otherwise of their requests, with the salaried-worker customer-group granted more credit finance than the others. Also, the bank had granted more credit in the form of loans. Sadly, business persons and other categories of customers were waiting three months for response to their credit finance requests. The customers and their bankers disagreed in their respective perspectives regarding the main reason(s) for granting or declining credit finance requests as well as on matters of collateral security. Among others, the study recommends the shortening of credit facility processing time to enhance the bank’s competitive drive in the banking industry and also to make these facilities more responsive to the needs of the customers. Future research is expected to conclude on the extent of impact that banks’ credit policies have on their credit finance creation.
VL  - 3
IS  - 5
ER  -

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