Understanding the Sustainability of Credit Unions Using the Pearls Model: Credit Unions in the Volta Region of Ghana in Perspective

Abstract

The financial performance of financial institutions is crucial for the growth and sustainability of which credit unions are no exception. This study sought to examine the financial performance of credit unions in the Volta Region of Ghana using the PEARLS ratio analysis model. Twenty-three (23) credit unions were selected from the Volta Region and their financial records were analysed using the PEARL ratio analysis. The findings discovered that majority of the ratios use were met by credit unions in the Volta Region, They alsohave good credit ratings despite providing relatively lower interest rates on loans, greater accessibility to loans, as well as customised services to their members than their larger counterparts in the financial industry. It is recommended that there should be improved use of technology, improved supervision by the regulator and CUA in building better reputation and confidence of credit unions. Ultimately, it will lead to the social and financial sustainability of credit unions in Ghana.