Uncertainty, Fear, and Coronavirus: The New Reality for Africa’s Entrepreneurs
Promoting good practices in women entrepreneur financing has always been an important focus of the SME Finance Forum. Financial inclusion for women has always been challenging, particularly in emerging and developing markets where women entrepreneurs have lower access to capital, which severely restricts their progress and ability to contribute to the national economies. The COVID-19 crisis makes financial inclusion for female entrepreneurs even more challenging as it poses serious threats to the financial stability of SMEs, and especially to women entrepreneurs. On Thursday, April 30, 2020, at 8 a.m., the Forum is organizing the sixth virtual roundtable on how institutions serving women-owned businesses in emerging markets are addressing these challenges, supporting them with innovative financial solutions during these unprecedented times of COVID-19 pandemic. In this story, originally posted on IFC's website you will read about the challenges of women entrepreneurs in Africa.
For Ada Osakwe, business was booming. Her Nuli Juice Company added six new stores in Lagos last year, and she had begun to use new technologies to expand her customer base even further in 2020. Then the Coronavirus arrived, and life changed in an instant. “This is just a completely new animal,” Osakwe, the founder of Nigeria’s Agrolay Ventures and Nuli Juice, says. “Things are changing every second.”
Osakwe, whose enterprise purchased nearly 200 tons of fresh produce from local farmers last year, was forced to shut down all of her shops and send her workers home. She paid employees’ salaries for March but doesn’t know what will happen in April. Her suppliers would also feel the pain.
Women and women-led businesses are vital drivers of economic growth and prosperity. Banks experience lower NPLs [nonperforming loans], deposit stability, increased market share, and higher customer loyalty when they provide comprehensive financial and operational solutions to women-led businesses,” said Jessica Schnabel, global head of IFC’s Banking on Women. “But too often, women are overlooked in the design of financial solutions. Now more than ever, it’s important for banks and fintechs to specifically and intentionally include women in their COVID-19 responses.”
IFC’s $8 billion COVID-19 fast-track response is already being deployed to support emerging market financial institutions and companies and their employees affected by the pandemic, as part of a $14 billion World Bank Group package. The majority of IFC’s fast track funding will be used to invest in client financial institutions to enable them to continue offering trade finance, working capital support to help companies pay their bills and their workers, and long-term financing for companies experiencing disruptions in supply chains. IFC’s Banking on Women is also ramping up efforts to provide investment, advisory expertise, and business-case data to financial institutions in emerging markets to help them respond and offer medium-term financial solutions for women business customers.