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Financing women-owned enterprises given priority by financial institutions in Africa

16 Jul 2007

Women have been a driving force of the African economy but have been discriminated against for a very long time. Although there has been an increase in the number of women-led enterprises in Africa, yet there exists a degree of disparity when it comes to extending credit to the women entrepreneurs, says the International Finance Corporation’s industries section VP.

In an initiative jointly with the Nigerian Access Bank, the IFC has increased the $15 mn on-lending available to women entrepreneurs for the maximum possible development of the Nigerian economy. This has made the Access Bank one of the first banks in Africa to dedicate lines of credit to finance women-owned business. The step of increasing access to lending as well as increased lending towards the women-owned enterprises would also work with the international MDG to promote gender equality and empower women, believes the IFC authorities.

IFC’s partnership with Access Bank is a pilot programme that it wants to replicate in other emerging markets in the region. Going by the findings of the gender-related research conducted by various organizations, which hold that women are more likely than men to contribute to additional income in the household poverty reduction and giving more women access to credit and increasing their economic power is more likely to translate into improved livelihoods for a varied and large section of the society. Moreover women entrepreneurs are more prone to employ other women. This idea led to the creation of GEM or Gender Entrepreneurship Markets programme, designed to leverage the potential of women entrepreneurs by providing them with a proper access to finace as well as address economic inefficiencies, social inequities and gender inequality persistent within the community. With Access Bank in Nigeria, other smaller initiatives have been taken in South Africa in smaller enterprises in the lines of those in Nigeria by the IFC.

In a related development, the ILO and the ADB have announced similar support for African women entrepreneurs recognizing their immense potential in the development of the continent. These organizations are concentrating on promoting growth of the continent, GOWE (growth-oriented women entrepreneurs) through lending more women industrialists in countries like Ethiopia, Kenya, Tanzania and Uganda. The two above-mentioned organizations have focused their support for women led enterprises in East Africa as a microcosm of the continental economic environment and also intend to extend the programme to the rest of Africa.

This however proves that in the last decade, a certain realization has dawned that women’s emancipation in business initiatives and reducing gender discrimination in terms of extending credit to women entrepreneurs would lead a long way towards the development of Africa per se. This is now being supported by powerful government and non-government organizations as well as civil societies and other community based organizations in Africa.

Resource: Nigerian Tribune
Released: 16 July 2007
For full report <click here>