The effects of Ponzi schemes and revocation of licences of some financial institutions on financial threat in Ghana

Abstract

PurposeThe purpose of this study was to assess the effects of the Ponzi schemes and revocation of licences of some financial institutions in Ghana on financial threat.Design/methodology/approachThe study adopted a quantitative research approach. Convenient sampling method was used to select 435 individuals from three regions in Ghana. Standardize questionnaire developed by the researcher was used as the main data collection instrument. The binary logistic regression was used to test the relationship between the dependent variable and the independent variables.FindingsThe results of the study showed a positive relationship between financial threat and job loss, general health, information search and loss of investment. However, negative relationship was identified between financial threat and total debt, stress, economic hardship and anxiety. Findings from this study imply that job loss, general health, information search and loss of investment are major factors that determined financial threat in Ghana.Practical implicationsThis indicates that individuals in Ghana have become uncertain regarding the use of current and future financial services in Ghana because most individuals have lost their jobs in the financial institutions, cannot get access to safe drinking water and education, need to gather more information before investing in financial institutions in Ghana and losing of funds invested.Originality/valueThis study is the first to test the effects of the Ponzi schemes and the revocation of licences of some financial institutions in Ghana on financial threat using binary logistic regression.