The 2023 Old Mutual Financial Services Monitor has disclosed that 64% of employed Ghanaians are facing financial stress, especially those with lower incomes (below GH¢3,000 per month) and those engaged in the informal sector.
A significant 55% reported earning less than pre-2022 or recession levels.
Instead of relying on personal savings, the majority (61%) turned to personal loans or borrowed from formal financial institutions to cover expenses.
The report highlighted that 54% depend on personal savings as a source of income.
Although only 10% sought loans from financial service providers, 24% borrowed from friends/family, and an additional 12% from a Susu.
“In an effort to make ends meet, 61% have dipped into their savings. 54% rely on their personal savings as a source of income.
“The incidence of taking out a loan from a financial services provider is low at 10%, but consumers are turning to other sources of borrowing – 24% have borrowed from friends/family, and a further 12% have borrowed from a Susu”.
The report revealed that just over half of Ghanaian consumers are currently earning less than a year ago, predating the recession in September 2022.
Consumer confidence in the Ghanaian economy is low, with less than one in six expressing confidence.
Despite economic challenges, over 90% of Ghanaians believe their financial situation will improve in the next six months.
The report attributes the tough economic environment to global and African factors such as poverty, debt, and rising food prices, impacting consumers worldwide and in Africa. The escalating cost of living has added pressure and eroded consumer buying power.
The Old Mutual Financial Services Monitor aims to understand the financial behavior, perceptions, and attitudes of the working population in Ghana, offering a consumer perspective to economic data.