Increase Focus on Women Entrepreneurs

Increase Focus on Women Entrepreneurs

Date: June 27, 2017
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By Sheila Maingi

Johannesburg, June 23: Today for the first time ever we celebrate International Day for small, medium-sized enterprises under the theme Small Business –Big Impact. According to the World Economic Forum, “SMEs are driver most of the jobs created in Sub-Saharan Africa; they generate an average of 80% of jobs in the region.” Given the high level of unemployment in the African continent against an ever-growing population, there are high expectations for SMEs to create even more jobs by 2030.

Most of the poor in Africa, majority of whom are women, are engaged in the informal economy. SMEs are a powerful means to include women and youth in the economy but determining their actual weight has been difficult given their high prevalence in the informal sector. It is important for government to analyse, understand and eliminate the challenges that SMEs encounter.

Access to finance has been the biggest challenge so far. The World Bank estimates that 50% of SMEs globally lack access to finance. This is attributable to SMEs operation within the informal sector where they cannot access formal banks loans and government credit. Women entrepreneurs have an even harder time raising funds for their businesses. Many therefore remain on the periphery of entrepreneurship and operate businesses that are not profitable. However, governments in the Southern African region are making efforts to increase financial access for SMEs.

In Zimbabwe for example, Daily News Zimbabwe reports that the Reserve Bank of Zimbabwe (RBZ) is working towards allowing movable assets as collateral to promote financial inclusion. More women than men participate in the informal sector in Zimbabwe. Agnes Magunje, a Zimbabwean entrepreneur, has described women as the future of the Zimbabwean economy in a recent article. Thus, prioritising funding for women led ventures is key.

The other challenge lies with simplifying entry regulations and ease of doing business for SMEs. In most African countries, there is a massive gender imbalance in entrepreneurship, where many women remain locked out. A report by SME Toolkit in South Africa notes that, the level of female ownership in entrepreneurial ventures is exceptionally low. Women do not get the assistance they require in starting businesses and can therefore not access on the job training and experience. Though some interventions to promote women enterprise development exist, many women are either not aware of what is available out there or the processes of accessing such support. This relates to applying for tenders as well.

In Southern Africa, Gender Links has been working to empower women financially through The Sunrise Campaign in 10 SADC countries. This program explores link between economic empowerment and sustainable solutions to Gender Based Violence (GBV). It helps women to develop their businesses through providing access to finance, education and support, while seeking to break the cycle of GBV violence. The campaign was a winner of Mail and Guardian 2016 ‘Investing in the Future Awards for Job Creation and Enterprise Development’.

“The challenges that I experienced included lack of knowledge of how to run a business; how to advertise it; and when I had sold the goods I would use the money from the sales without saving. I fought these challenges by having to keep my business record books, be able to track my profits and pay myself at the end of the month, so that there would be no way that I would tamper with business money to run my household,” noted Mafumanang Sekonyela, a participant in the entrepreneurship training in Lesotho

Some of the achievements from the pilot phase include 85% of the women indicating that they experienced much less or no abuse once they completed the programme. Notable also, was an average increase in income per month for the region to R526 and an overall increase in income in 2015 as a result of the project to R10.8 million; a 66% increase. There has since been a follow-up mentorship phase and Gender Links is working with more women in the next revised phase.

Governments need to realize that a vibrant SMEs sector can be a catalyst for accelerated economic development and sustainable growth in their countries and must therefore dedicate their efforts in stabilising the sector.

To donate to the Sunrise campaign click here

Sheila Maingi is a governance intern at Gender Links

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