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Financial Arrangements in Informal Apprenticeships: Determinants and Effects - Findings from Urban Ghana
This paper uses quantitative and qualitative data collected through a survey among entrepreneurs and apprentices in micro and small enterprises in Accra, Ghana, to analyse the financial arrangements in informal apprenticeships. It discusses the relationship between the financing of apprenticeships and the financing of enterprises in which the raining takes place. It also examines the way apprentices finance apprenticeship training. The findings suggest that masters commonly charge fees for the training, either at the beginning (commitment fees) and or at the end graduation fee) of the training. The payment of an allowance to the apprentices (chop money) is a widespread practice. Even if the amount of this allowance in the majority of cases exceeds the amount of fees paid for the training, it would appear that the financing costs of the apprenticeship (fees and living expenses) restrict poor youth from entering and completing an apprenticeship. Finally, the paper presents potential entry points for microfinance institutions to support and improve the quantity and quality of apprenticeship training and ensure its positive contribution to youth employment.