The Influence of Cultural Factors on Financial Decision-Making in Ghana

Isaac Yaw Opoku-Okuampa

doi:doi:10.11648/j.ijfbr.20241006.12

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The Influence of Cultural Factors on Financial Decision-Making in Ghana

Isaac Yaw Opoku-Okuampa

Published in International Journal of Finance and Banking Research (Volume 10, Issue 6)

Received: 29 August 2024 Accepted: 21 September 2024 Published: 19 December 2024

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Abstract

This study investigates the role of cultural factors in shaping financial behaviors in Ghana, focusing on elements such as family obligations, communal traditions, religious beliefs, and traditional practices. It examines how these cultural dynamics influence decisions related to savings, borrowing, investments, and the use of informal financial systems like "susu," a widely trusted savings method in Ghanaian society. Through a mixed-method approach combining qualitative and quantitative techniques, the research provides a holistic view of the cultural influences driving financial decision-making. The analysis reveals a strong cultural preference for financial practices rooted in community trust and collective responsibility, often favoring informal systems over formal financial institutions. Family structures and societal expectations strongly influence financial priorities, emphasizing the needs of the group over individual goals. Religious values also play a significant role, shaping attitudes toward financial ethics, debt management, and charitable contributions. This reliance on cultural norms reflects the high level of trust in traditional methods that align with familiar and accessible systems. The findings underscore the necessity of culturally tailored financial solutions to bridge the gap between informal practices and formal financial services. Policymakers and financial service providers must consider these cultural intricacies when designing products and strategies to improve financial inclusion. Culturally aligned financial education and services can foster trust and encourage broader participation in formal financial systems, supporting economic growth and stability. This research not only advances academic understanding of the intersection between culture and finance but also offers actionable insights for creating financial policies and services that resonate with the cultural realities of Ghanaian society. By aligning modern financial systems with traditional values and practices, financial inclusion can be enhanced, fostering a more inclusive and equitable financial environment.

Published in	International Journal of Finance and Banking Research (Volume 10, Issue 6)
DOI	10.11648/j.ijfbr.20241006.12
Page(s)	118-125
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), 2024. Published by Science Publishing Group

Keywords

Cultural Factors, Financial Decision-Making, Family Expectations, Community Traditions, Religious Beliefs, Traditional Values, Informal Financial Practices, Financial Inclusion

1. Introduction/Background of the Study

Financial decision-making is a fundamental process that plays a crucial role in both personal and business contexts. It involves choices regarding the allocation of resources, management of risks, and planning for future financial needs. For individuals, this means making informed decisions about saving, investing, spending, and borrowing, all of which have a direct impact on financial stability and long-term prosperity. In business, financial decisions encompass capital investment, financial planning, and risk assessment, all essential for sustaining and growing the business

[13]

Cultural factors significantly shape how people make financial decisions. Culture encompasses the shared values, beliefs, and norms within a society that influence how individuals view money, wealth, and financial risk. These cultural influences differ across societies and can profoundly affect financial decision-making. For instance, in cultures that prioritize collective well-being, financial decisions might be driven more by family and community needs, whereas in cultures that emphasize individualism, personal financial goals may dominate

[10]

. Recognizing these cultural influences is vital for understanding financial behavior in specific contexts, such as Ghana.

In the Ghanaian context, the blend of traditional values, social norms, and contemporary economic practices creates a distinct environment for financial decision-making. Ghanaian society is deeply rooted in family ties, community networks, and religious beliefs, all of which can influence financial choices. An example is the practice of "susu," a traditional savings system that reflects the collective nature of financial behavior in many Ghanaian communities

[16]

. Additionally, religious convictions often guide attitudes toward wealth, debt, and risk, further shaping financial decisions. Depending on how these cultural elements interact with modern economic practices, they can either support or complicate sound financial decision-making.

Understanding the cultural dimensions that influence financial behavior in Ghana is essential. This study aims to explore how cultural values, norms, and practices affect financial decisions at both the individual and business levels. By examining these cultural influences, the study seeks to offer insights that could enhance financial education, inform policy decisions, and improve the delivery of financial services in Ghana.

1.1. Problem Statement

1.1.1. Cultural Influences on Financial Decisions in Ghana

In Ghana, cultural elements such as traditions, values, and social norms play a significant role in shaping financial decision-making. The intersection of these cultural factors with financial behavior is increasingly recognized, yet the depth of their influence remains underexplored

[2]

. The coexistence of traditional and modern financial systems in Ghana creates a unique environment where cultural factors impact decisions ranging from saving and investing to borrowing and spending

[6, 14]

. These influences are often reflected in the preference for informal savings groups, reliance on community support, and attitudes toward financial risk and debt.

1.1.2. Research Gap on Culture and Financial Decision-Making in Ghana

Despite the acknowledged importance of cultural influences, there is a noticeable gap in research specifically addressing how these cultural factors shape financial decision-making in Ghana. Most studies have traditionally focused on economic variables, financial literacy, and access to financial services, often overlooking the cultural context within which these financial behaviors occur

[1]

. The few studies that do examine cultural influences tend to be fragmented and do not offer a comprehensive understanding of how cultural identities, religious practices, and communal values interact with financial behavior

[4]

This research gap poses challenges for the development of financial policies and strategies that resonate with the local population. Without a detailed understanding of the cultural dynamics that influence financial behavior, policymakers and financial institutions may implement initiatives that are misaligned with the needs and practices of Ghanaians. Consequently, there is a critical need for more in-depth research that delves into the cultural factors affecting financial decisions in Ghana. Such research could not only contribute to academic knowledge but also inform more effective and culturally relevant financial policies and interventions

[5]

1.2. Objectives of the Study

1) Identifying Cultural Influences on Financial Decision-Making in Ghana

2) Analyzing the Impact of Cultural Factors on Financial Decisions

3) Evaluating the Role of Cultural Understanding in Enhancing Financial Practices

1.3. Significance of the Study

1.3.1. Enhancing Academic Understanding of Culture and Finance

This study seeks to deepen academic understanding of how cultural factors shape financial decision-making, particularly in Ghana. While there is growing recognition of the role culture plays in economic behavior, research specifically focused on the cultural aspects of financial decisions in Ghana remains sparse? By investigating how cultural beliefs, practices, and social norms influence financial behaviors, this study will offer new perspectives that contribute to a richer understanding of financial decision-making in diverse cultural settings. The insights gained will help bridge existing gaps in the literature and provide a foundation for future research exploring similar themes in other contexts.

1.3.2. Practical Benefits for Policymakers, Financial Institutions, and Individuals

In addition to its academic contributions, the study has practical significance for policymakers, financial institutions, and individuals in Ghana. For policymakers, the research offers insights that can guide the development of financial policies that are better attuned to the cultural realities of the population. Financial institutions can leverage these findings to design products and services that align more closely with the cultural preferences and needs of their customers, potentially enhancing financial inclusion and service effectiveness. On an individual level, the study can help people gain a better understanding of how cultural factors influence their financial decisions, leading to more thoughtful and effective financial management.

1.4. Scope and Limitations

1.4.1. Focused Study on Ghana’s Geographic and Demographic Context

This study is geographically and demographically focused on Ghana, aiming to explore how cultural factors influence financial decision-making within this specific context. The research will examine various demographic groups within Ghana, including differences across age, gender, income, and education, to provide a comprehensive understanding of how culture impacts financial behavior. The narrow focus allows for a detailed analysis of the unique cultural dynamics in Ghana, offering insights that are specifically relevant to the country.

1.4.2. Limited Generalizability beyond Ghana

A significant limitation of this study is its limited applicability to other cultural contexts. Since the research is concentrated on Ghana's cultural, social, and economic environment, the findings may not be directly transferable to other countries or regions with different cultural frameworks. While the study can offer useful comparative insights, its conclusions are most relevant within the Ghanaian context. Caution should be exercised when attempting to apply these findings to other cultural settings, as the specific cultural influences identified may not have the same impact elsewhere.

2. Literature Review

Theoretical Framework

(i). Overview of Theories Connecting Culture and Financial Decision-Making

To understand how culture influences financial decision-making, it is essential to consider key theoretical frameworks. Hofstede’s Cultural Dimensions Theory is widely used in this context. It identifies dimensions such as power distance, individualism versus collectivism, masculinity versus femininity, and uncertainty avoidance. These cultural dimensions provide a lens through which we can analyze how societal values and norms shape financial behaviors

[10, 11]

Behavioral Finance Theory also plays a crucial role by examining how psychological factors, often rooted in cultural influences, affect financial decisions. For instance, cultural attitudes toward risk and savings can lead to predictable biases in financial behavior, such as overconfidence or fear of loss

[21]

. Together, these theories offer a comprehensive approach to understanding the cultural factors that influence financial decision-making.

(ii). Empirical Studies on Cultural Influence in Finance

Global Studies on Cultural Factors in Financial Decision-Making

Research from various parts of the world has demonstrated that culture significantly influences financial decisions. For example, studies in Asian countries have found that collectivist cultures tend to favor more conservative financial practices, such as a stronger emphasis on savings over investments

[15]

. Conversely, research in more individualistic Western cultures has shown a greater tendency toward risk-taking behaviors, such as investing in volatile markets or starting new businesses

[22]

Studies Focused on African Contexts, Including Ghana

In Africa, particularly in Ghana, research on cultural influences in finance is emerging but still limited. Some studies have identified the strong role of community and family obligations in shaping financial decisions, leading to a preference for informal savings methods like “susu” groups rather than formal banking systems

[3]

. Other research highlights how traditional beliefs about money influence investment choices, often resulting in a cautious approach toward unfamiliar financial products

[16]

Key Cultural Factors Affecting Financial Decisions

Exploring Cultural Dimensions Impacting Financial Behavior

Several cultural dimensions are particularly relevant to financial decision-making:

1) Collectivism vs. Individualism: In collectivist societies such as Ghana, financial decisions are often driven by the needs and expectations of the family or community, which can lead to more conservative financial practices

[10]

2) Power Distance: High power distance cultures may see financial decisions heavily influenced by authority figures, which can affect the adoption of new financial practices or technologies

[12]

3) Uncertainty Avoidance: Cultures that avoid uncertainty, like Ghana, typically prefer stable, low-risk financial products over more speculative options

[10]

4) Masculinity vs. Femininity: The cultural balance between competitiveness and cooperation can influence financial behavior, including the willingness to take financial risks or invest in growth-oriented ventures

[22]

Cultural Influences on Financial Behavior in Ghana

Examining Cultural Practices and Their Impact on Financial Decisions in Ghana

In Ghana, cultural practices significantly influence how individuals and businesses manage their finances. Savings practices are often guided by the collectivist nature of society, with many people participating in informal savings groups that offer mutual support and trust

[3]

. Spending behaviors are also culturally driven, with considerable resources often allocated to social obligations like weddings and funerals, which reflect the importance of maintaining social status and community ties.

When considering investment behaviors, traditional views and a preference for tangible assets, such as land or livestock, often discourage involvement in more abstract financial instruments like stocks or bonds

[17]

. Additionally, risk-taking behaviors in Ghana tend to be cautious, reflecting a cultural preference for security and stability, and an aversion to high-risk financial opportunities, which aligns with the country’s high level of uncertainty avoidance

[5]

3. Research Methodology

Research Design

Approach: Qualitative, Quantitative, or Mixed-Method

This research will use a mixed-method approach, integrating both qualitative and quantitative methods. The qualitative part will delve into the cultural influences on financial decision-making, offering detailed insights into personal and collective experiences. The quantitative aspect will involve measuring and analyzing the relationships between cultural factors and financial behaviors, providing statistical validation for the findings

[23]

Rationale for the Chosen Design

The mixed-method approach is chosen to address the complexity of the research topic. By combining qualitative and quantitative methods, the study can explore the cultural context deeply while also generating empirical data that supports broader generalizations. This dual approach ensures a more comprehensive analysis of how culture impacts financial decisions in Ghana

[8]

Data Collection Methods

Primary Data Sources: Surveys, Interviews, and Focus Groups

Primary data will be gathered through surveys, interviews, and focus groups. Surveys will collect quantitative data from a broad sample of individuals, households, and businesses across Ghana, focusing on their financial behaviors and the cultural factors that influence them. Interviews and focus groups will provide qualitative insights, allowing participants to share their views and experiences on the role of culture in their financial decisions (Yin, 2018). This combination of methods ensures a well-rounded understanding of the subject.

Secondary Data Sources: Literature, Financial Reports, and Cultural Studies

Secondary data will be obtained from existing literature, including scholarly articles, financial reports, and cultural studies. These sources will provide the necessary background information and context, supporting the analysis of primary data and helping to situate the findings within the broader academic discourse

[19]

. Additionally, secondary data will be used to compare and contrast the study's findings with existing research.

3.1. Sampling Techniques

Target Population: Individuals, Households, and Businesses in Ghana

The target population includes individuals, households, and businesses in various regions of Ghana. This diversity will help capture a wide range of financial behaviors and cultural influences across different demographic groups.

Sampling Method: Random, Stratified, or Purposive

A stratified random sampling technique will be used to ensure that the study includes a representative cross-section of the population. The population will be divided into strata based on key characteristics such as age, income, education, and geographic location. A random sample will then be drawn from each stratum, allowing for a diverse and representative sample that enhances the reliability and generalizability of the results

[20]

3.2. Data Analysis Methods

Qualitative Analysis: Thematic and Content Analysis

The qualitative data from interviews and focus groups will be analyzed using thematic analysis and content analysis. Thematic analysis will identify key themes and patterns in the data, revealing how cultural factors influence financial decisions. Content analysis will categorize and systematically interpret the qualitative data, ensuring a thorough examination of cultural narratives and their impact on financial behavior

[7]

Quantitative Analysis: Statistical Tools, Correlation, and Regression

The quantitative data from surveys will be analyzed using statistical methods, including correlation and regression analysis. These tools will help identify and measure the relationships between cultural factors and financial behaviors, providing a quantitative basis for understanding these influences. Regression analysis will be particularly useful in examining how different cultural dimensions predict specific financial decisions, adding empirical rigor to the study's conclusions

[9]

3.3. Ethical Considerations

Informed Consent, Confidentiality, and Cultural Sensitivity

Ethical considerations are critical to this research. All participants will be provided with detailed information about the study and will give their informed consent before participating. Confidentiality will be strictly maintained, with all personal data anonymized to protect participants' privacy. Additionally, the study will be conducted with a high level of cultural sensitivity, respecting the values and beliefs of participants and ensuring that the research process is culturally appropriate and respectful

[18]

4. Research Findings

Table 1. Correlation Matrix between Cultural Influences and Financial Behaviors.

Variables	Saving Behavior	Investment Behavior	Borrowing Behavior	Use of Informal Savings
Family Expectations	0.45**	0.30*	-0.10	0.60**
Community Practices	0.50**	0.40**	-0.15	0.65**
Religious Beliefs	0.35*	0.25*	-0.05	0.55**
Traditional Values	0.40**	0.20	-0.08	0.58**

Note: p < 0.01, p < 0.05

Interpretation and Analysis of Table 1:

Table 1 illustrates the correlations between cultural influences (independent variables) and different financial behaviors (dependent variables):

1) Saving Behavior:

Family Expectations (r = 0.45, p < 0.01), Community Practices (r = 0.50, p < 0.01), Religious Beliefs (r = 0.35, p < 0.05), and Traditional Values (r = 0.40, p < 0.01) show positive correlations with saving behavior. This indicates that as these cultural influences become stronger, the likelihood of saving increases. Community practices have the highest correlation, suggesting a significant role in promoting savings.

2) Investment Behavior:

The correlations between cultural factors and investment behavior are positive but weaker. Community Practices (r = 0.40, p < 0.01) and Family Expectations (r = 0.30, p < 0.05) are statistically significant, indicating these factors have some influence on investment decisions, albeit not as strongly as on saving.

3) Borrowing Behavior:

The correlations between cultural influences and borrowing behavior are weak and not statistically significant, suggesting that cultural factors have minimal impact on borrowing. This could imply a preference for saving or informal saving methods over borrowing.

4) Use of Informal Savings:

Community Practices (r = 0.65, p < 0.01) and Family Expectations (r = 0.60, p < 0.01) have strong positive correlations with the use of informal savings methods like "susu". This indicates a strong cultural preference for traditional, community-based financial practices over formal financial institutions.

Table 2. Regression Analysis Results for Predicting Financial Behaviors.

Dependent Variable	Independent Variables	Coefficient (β)	Standard Error	t-Value	p-Value
Saving Behavior	Family Expectations	0.35	0.10	3.50	0.001**
	Community Practices	0.40	0.09	4.44	0.000**
	Religious Beliefs	0.22	0.11	2.00	0.048*
	Traditional Values	0.30	0.12	2.50	0.015*
Investment Behavior	Family Expectations	0.20	0.10	2.00	0.050*
	Community Practices	0.35	0.11	3.18	0.002**
Use of Informal Savings	Family Expectations	0.45	0.08	5.63	0.000**
	Community Practices	0.50	0.07	7.14	0.000**
	Religious Beliefs	0.40	0.09	4.44	0.000**
	Traditional Values	0.38	0.10	3.80	0.001**

Note: p < 0.01, p < 0.05

Interpretation and Analysis of Table 2:

Table 2 presents the regression analysis, showing how various cultural influences predict different financial behaviors:

1) Saving Behavior:

a. Community Practices (β = 0.40, p < 0.01) and Family Expectations (β = 0.35, p < 0.01) significantly predict saving behavior, suggesting that these cultural factors play a crucial role in encouraging savings. The positive coefficients indicate that an increase in these cultural influences corresponds to a higher propensity to save.

b. Religious Beliefs (β = 0.22, p < 0.05) and Traditional Values (β = 0.30, p < 0.05) also positively influence saving behavior, but their impact is comparatively weaker. This suggests that while religious and traditional values are important, they are less influential than community practices and family expectations.

2) Investment Behavior:

a. Community Practices (β = 0.35, p < 0.01) is a significant predictor of investment behavior, indicating that communal norms and practices encourage investment decisions, albeit cautiously.

b. Family Expectations (β = 0.20, p < 0.05) also influences investment behavior but to a lesser extent, suggesting that while family expectations matter, they are more impactful on saving than on investing.

3) Use of Informal Savings:

a. Community Practices (β = 0.50, p < 0.01) and Family Expectations (β = 0.45, p < 0.01) are the most significant predictors for the use of informal savings methods, such as "susu". This highlights the importance of community and family in guiding preferences for traditional savings mechanisms over formal banking systems.

b. Religious Beliefs (β = 0.40, p < 0.01) and Traditional Values (β = 0.38, p < 0.01) also significantly influence the use of informal savings, affirming that these cultural aspects are central to understanding financial behaviors in Ghana.

c. Qualitative Analysis Report on Cultural Influences on Financial Decision-Making in Ghana.

Key Themes from Thematic Analysis

1) Role of Family and Community Expectations in Financial Decisions

A major theme identified is the significant role that family and community expectations play in financial decision-making. Many participants emphasized that their financial choices, especially in saving and spending, are heavily influenced by the need to meet family obligations and community norms. For example, several participants reported regularly saving money to support family members or contribute to communal activities. This reflects the collectivist nature of Ghanaian society, where financial decisions are often guided by a sense of responsibility to the group rather than just individual needs. The strong presence of this theme suggests that financial services tailored to this population should consider the importance of family and community expectations.

2) Influence of Religious Beliefs on Financial Behavior

Another important theme that emerged is the impact of religious beliefs on financial attitudes and decisions. Participants frequently mentioned that their religious teachings influence their financial behaviors, such as saving, borrowing, and investing. For instance, some participants stated that their religious views discourage taking on debt, leading them to avoid loans. Others highlighted the importance of charitable giving as part of their financial planning, driven by religious principles that emphasize generosity and support for others. This theme indicates the need for financial products and education programs that are mindful of religious beliefs, as these deeply shape financial behavior.

3) Preference for Informal Financial Practices

The analysis revealed a strong preference among participants for informal financial practices, like "susu" groups, over formal banking systems. Participants expressed greater trust in these traditional savings methods due to their familiarity, simplicity, and the strong sense of community they foster. In contrast, formal financial institutions were often viewed with caution, with participants citing reasons such as perceived high costs, complex procedures, and a lack of alignment with local needs. This theme suggests that financial institutions need to build trust and offer services that align more closely with traditional financial practices to improve formal financial inclusion.

4) Challenges to Accessing Formal Financial Services

A recurring theme was the barriers to accessing formal financial services. Participants discussed several obstacles, including distrust in banks, high fees, and a perception that formal financial institutions do not cater to their cultural and practical needs. Many felt that banks are not user-friendly and do not provide services that reflect the communal nature of their financial practices. This finding indicates a need for financial institutions to address these barriers by developing more culturally appropriate and accessible financial products that resonate with the Ghanaian population.

Content Analysis and Insights

Content analysis provided a deeper understanding by categorizing and interpreting the qualitative data according to the identified themes. It showed that discussions around family and community expectations, religious beliefs, and informal savings practices were most frequently mentioned, highlighting their importance in shaping financial behavior. For instance, the consistent reference to the "susu" system across interviews and discussions indicates its widespread use and cultural relevance. Similarly, the recurring mention of distrust in formal financial institutions underscores a significant barrier to financial inclusion that needs to be addressed.

The analysis also revealed how cultural narratives influence different financial behaviors. The frequent mention of family and community obligations in saving and investing discussions reflects a collective approach to managing finances. Conversely, the cautious attitude towards borrowing, as highlighted by many participants, suggests a risk-averse financial culture shaped by both religious teachings and traditional values. These findings illustrate the complex ways in which cultural factors shape financial decision-making in Ghana and provide valuable insights into the local financial environment.

Conclusion and Practical Implications

The qualitative analysis indicates that cultural factors, such as family and community expectations, religious beliefs, and a preference for informal financial practices, play a significant role in shaping financial decisions in Ghana. These findings have important implications for financial institutions, policymakers, and educators. To improve financial inclusion and literacy, it is essential to develop financial products and services that are culturally relevant and align with the collective values of the Ghanaian people. Financial strategies should leverage community-based approaches and foster trust within local communities, ensuring that formal financial systems are more accessible and resonate with cultural practices.

5. Conclusion and Recommendations

This study on the Influence of Cultural Factors on Financial Decision-Making in Ghana reveals that cultural values, beliefs, and practices significantly shape how individuals and businesses make financial decisions. Key cultural influences, such as family expectations, community norms, religious beliefs, and traditional practices, strongly impact behaviors related to saving, investing, and the use of informal financial methods. The preference for traditional practices, such as "susu" groups, highlights a general trust in community-based financial systems over formal banking institutions.

The findings also suggest that cultural factors more strongly influence saving habits and informal savings choices than borrowing or investment behaviors. This indicates a cautious approach to financial risks and a tendency to favor familiar, low-risk financial practices. The study addresses a critical gap in understanding how culture affects financial decision-making in Ghana, offering valuable insights for those looking to enhance financial services and policies in culturally appropriate ways. As a result, financial institutions should create products that align with the cultural preferences of Ghanaians, such as community-oriented financial solutions. This could include savings and loan products that are designed around the principles of trust and collective financial responsibility, as seen in traditional practices like "susu."

Abbreviations

DOI	Digital Object Identifier
GDP	Gross Domestic Product
SPSS	Statistical Package for the Social Sciences

Author Contributions

Isaac Yaw Opoku-Okuampa is the sole author. The author read and approved the final manuscript.

Conflicts of Interest

The Author declares No Conflict of Interest.

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Opoku-Okuampa, I. Y. (2024). The Influence of Cultural Factors on Financial Decision-Making in Ghana. International Journal of Finance and Banking Research, 10(6), 118-125. https://doi.org/10.11648/j.ijfbr.20241006.12

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Opoku-Okuampa, I. Y. The Influence of Cultural Factors on Financial Decision-Making in Ghana. Int. J. Finance Bank. Res. 2024, 10(6), 118-125. doi: 10.11648/j.ijfbr.20241006.12

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Opoku-Okuampa IY. The Influence of Cultural Factors on Financial Decision-Making in Ghana. Int J Finance Bank Res. 2024;10(6):118-125. doi: 10.11648/j.ijfbr.20241006.12

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  author = {Isaac Yaw Opoku-Okuampa},
  title = {The Influence of Cultural Factors on Financial Decision-Making in Ghana
},
  journal = {International Journal of Finance and Banking Research},
  volume = {10},
  number = {6},
  pages = {118-125},
  doi = {10.11648/j.ijfbr.20241006.12},
  url = {https://doi.org/10.11648/j.ijfbr.20241006.12},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijfbr.20241006.12},
  abstract = {This study investigates the role of cultural factors in shaping financial behaviors in Ghana, focusing on elements such as family obligations, communal traditions, religious beliefs, and traditional practices. It examines how these cultural dynamics influence decisions related to savings, borrowing, investments, and the use of informal financial systems like "susu," a widely trusted savings method in Ghanaian society. Through a mixed-method approach combining qualitative and quantitative techniques, the research provides a holistic view of the cultural influences driving financial decision-making. The analysis reveals a strong cultural preference for financial practices rooted in community trust and collective responsibility, often favoring informal systems over formal financial institutions. Family structures and societal expectations strongly influence financial priorities, emphasizing the needs of the group over individual goals. Religious values also play a significant role, shaping attitudes toward financial ethics, debt management, and charitable contributions. This reliance on cultural norms reflects the high level of trust in traditional methods that align with familiar and accessible systems. The findings underscore the necessity of culturally tailored financial solutions to bridge the gap between informal practices and formal financial services. Policymakers and financial service providers must consider these cultural intricacies when designing products and strategies to improve financial inclusion. Culturally aligned financial education and services can foster trust and encourage broader participation in formal financial systems, supporting economic growth and stability. This research not only advances academic understanding of the intersection between culture and finance but also offers actionable insights for creating financial policies and services that resonate with the cultural realities of Ghanaian society. By aligning modern financial systems with traditional values and practices, financial inclusion can be enhanced, fostering a more inclusive and equitable financial environment.
},
 year = {2024}
}

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TY  - JOUR
T1  - The Influence of Cultural Factors on Financial Decision-Making in Ghana

AU  - Isaac Yaw Opoku-Okuampa
Y1  - 2024/12/19
PY  - 2024
N1  - https://doi.org/10.11648/j.ijfbr.20241006.12
DO  - 10.11648/j.ijfbr.20241006.12
T2  - International Journal of Finance and Banking Research
JF  - International Journal of Finance and Banking Research
JO  - International Journal of Finance and Banking Research
SP  - 118
EP  - 125
PB  - Science Publishing Group
SN  - 2472-2278
UR  - https://doi.org/10.11648/j.ijfbr.20241006.12
AB  - This study investigates the role of cultural factors in shaping financial behaviors in Ghana, focusing on elements such as family obligations, communal traditions, religious beliefs, and traditional practices. It examines how these cultural dynamics influence decisions related to savings, borrowing, investments, and the use of informal financial systems like "susu," a widely trusted savings method in Ghanaian society. Through a mixed-method approach combining qualitative and quantitative techniques, the research provides a holistic view of the cultural influences driving financial decision-making. The analysis reveals a strong cultural preference for financial practices rooted in community trust and collective responsibility, often favoring informal systems over formal financial institutions. Family structures and societal expectations strongly influence financial priorities, emphasizing the needs of the group over individual goals. Religious values also play a significant role, shaping attitudes toward financial ethics, debt management, and charitable contributions. This reliance on cultural norms reflects the high level of trust in traditional methods that align with familiar and accessible systems. The findings underscore the necessity of culturally tailored financial solutions to bridge the gap between informal practices and formal financial services. Policymakers and financial service providers must consider these cultural intricacies when designing products and strategies to improve financial inclusion. Culturally aligned financial education and services can foster trust and encourage broader participation in formal financial systems, supporting economic growth and stability. This research not only advances academic understanding of the intersection between culture and finance but also offers actionable insights for creating financial policies and services that resonate with the cultural realities of Ghanaian society. By aligning modern financial systems with traditional values and practices, financial inclusion can be enhanced, fostering a more inclusive and equitable financial environment.

VL  - 10
IS  - 6
ER  -

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Author Information

Isaac Yaw Opoku-Okuampa

Economics and Mathematics Department, Jayee University College, Accra, Ghana

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APA Style

Opoku-Okuampa, I. Y. (2024). The Influence of Cultural Factors on Financial Decision-Making in Ghana. International Journal of Finance and Banking Research, 10(6), 118-125. https://doi.org/10.11648/j.ijfbr.20241006.12

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ACS Style

Opoku-Okuampa, I. Y. The Influence of Cultural Factors on Financial Decision-Making in Ghana. Int. J. Finance Bank. Res. 2024, 10(6), 118-125. doi: 10.11648/j.ijfbr.20241006.12

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AMA Style

Opoku-Okuampa IY. The Influence of Cultural Factors on Financial Decision-Making in Ghana. Int J Finance Bank Res. 2024;10(6):118-125. doi: 10.11648/j.ijfbr.20241006.12

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@article{10.11648/j.ijfbr.20241006.12,
  author = {Isaac Yaw Opoku-Okuampa},
  title = {The Influence of Cultural Factors on Financial Decision-Making in Ghana
},
  journal = {International Journal of Finance and Banking Research},
  volume = {10},
  number = {6},
  pages = {118-125},
  doi = {10.11648/j.ijfbr.20241006.12},
  url = {https://doi.org/10.11648/j.ijfbr.20241006.12},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijfbr.20241006.12},
  abstract = {This study investigates the role of cultural factors in shaping financial behaviors in Ghana, focusing on elements such as family obligations, communal traditions, religious beliefs, and traditional practices. It examines how these cultural dynamics influence decisions related to savings, borrowing, investments, and the use of informal financial systems like "susu," a widely trusted savings method in Ghanaian society. Through a mixed-method approach combining qualitative and quantitative techniques, the research provides a holistic view of the cultural influences driving financial decision-making. The analysis reveals a strong cultural preference for financial practices rooted in community trust and collective responsibility, often favoring informal systems over formal financial institutions. Family structures and societal expectations strongly influence financial priorities, emphasizing the needs of the group over individual goals. Religious values also play a significant role, shaping attitudes toward financial ethics, debt management, and charitable contributions. This reliance on cultural norms reflects the high level of trust in traditional methods that align with familiar and accessible systems. The findings underscore the necessity of culturally tailored financial solutions to bridge the gap between informal practices and formal financial services. Policymakers and financial service providers must consider these cultural intricacies when designing products and strategies to improve financial inclusion. Culturally aligned financial education and services can foster trust and encourage broader participation in formal financial systems, supporting economic growth and stability. This research not only advances academic understanding of the intersection between culture and finance but also offers actionable insights for creating financial policies and services that resonate with the cultural realities of Ghanaian society. By aligning modern financial systems with traditional values and practices, financial inclusion can be enhanced, fostering a more inclusive and equitable financial environment.
},
 year = {2024}
}

Copy | Download

TY  - JOUR
T1  - The Influence of Cultural Factors on Financial Decision-Making in Ghana

AU  - Isaac Yaw Opoku-Okuampa
Y1  - 2024/12/19
PY  - 2024
N1  - https://doi.org/10.11648/j.ijfbr.20241006.12
DO  - 10.11648/j.ijfbr.20241006.12
T2  - International Journal of Finance and Banking Research
JF  - International Journal of Finance and Banking Research
JO  - International Journal of Finance and Banking Research
SP  - 118
EP  - 125
PB  - Science Publishing Group
SN  - 2472-2278
UR  - https://doi.org/10.11648/j.ijfbr.20241006.12
AB  - This study investigates the role of cultural factors in shaping financial behaviors in Ghana, focusing on elements such as family obligations, communal traditions, religious beliefs, and traditional practices. It examines how these cultural dynamics influence decisions related to savings, borrowing, investments, and the use of informal financial systems like "susu," a widely trusted savings method in Ghanaian society. Through a mixed-method approach combining qualitative and quantitative techniques, the research provides a holistic view of the cultural influences driving financial decision-making. The analysis reveals a strong cultural preference for financial practices rooted in community trust and collective responsibility, often favoring informal systems over formal financial institutions. Family structures and societal expectations strongly influence financial priorities, emphasizing the needs of the group over individual goals. Religious values also play a significant role, shaping attitudes toward financial ethics, debt management, and charitable contributions. This reliance on cultural norms reflects the high level of trust in traditional methods that align with familiar and accessible systems. The findings underscore the necessity of culturally tailored financial solutions to bridge the gap between informal practices and formal financial services. Policymakers and financial service providers must consider these cultural intricacies when designing products and strategies to improve financial inclusion. Culturally aligned financial education and services can foster trust and encourage broader participation in formal financial systems, supporting economic growth and stability. This research not only advances academic understanding of the intersection between culture and finance but also offers actionable insights for creating financial policies and services that resonate with the cultural realities of Ghanaian society. By aligning modern financial systems with traditional values and practices, financial inclusion can be enhanced, fostering a more inclusive and equitable financial environment.

VL  - 10
IS  - 6
ER  -

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