Over 15 000 women-led businesses are expected to benefit and about $350 million in additional public and private sector resources are set to be mobilised through a funding allocation by the Women Entrepreneurs Finance Initiative (We-Fi). This multilateral partnership supporting women entrepreneurs in accessing services including finance, markets, technology and mentoring announced its third funding allocation of $49.3 Million on 20 August to address the needs of women entrepreneurs created by COVID-19.
Angela Bekkers, senior external affairs officer of the We-Fi secretariat, says the funding aims to encourage innovation and digital development, partnership development and use of results-based mechanisms to facilitate greater access to financing for women entrepreneurs. She says the funding in the third round is allocated for programs to boost women’s entrepreneurship that will be implemented by four multilateral development banks.
They include the European Bank for Reconstruction and Development (EBRD) for programs in Central Asia and the North Africa region, the Inter-American Development Bank (IDB) for projects in Latin America, the Islamic Development Bank for entrepreneurship activities in fragile contexts in West Africa and the World Bank Group for projects in the Sahel region, Middle East and North Africa and global programs.
According to Bekkers, the EBRD was granted $7.36 million for its Stepping Up for Women business program which will deploy solutions for female Small and Medium-sized Enterprises (SMEs) that will contribute to improving access to markets, enhance competitiveness, growth potential and access to finance. She says the IDB received $14.71 million for its program to support access to finance, markets, skills and networks for women-led businesses primarily in technology and science-supported sectors.
“The Islamic Development Bank received $11.25 million for its program to support upgrading and advancing women-owned SMEs within the rice value chain in West Africa though capacity development, grant matching and increased access to local and regional markets. The World Bank Group received $16.01 million for a digitally enabled access to finance and markets program for women-led business in the Sahel region and an early-stage finance program supporting women entrepreneurs in several regions globally,” she says.
Over 65% of the most recent allocations will benefit women entrepreneurs in low-income (International Development Association-eligible) countries and countries affected by fragility and conflict. As a result of the three financing rounds which now total almost $300 million in allocations, programs backing women-led businesses will soon expand to 61 countries.
Mari Pangestu, managing director of Development Policy and Partnerships of the World Bank, which hosts the We-Fi Secretariat, says as we absorb the consequences of COVID-19 around the world, we need to take strong actions to build back better. She says many women-led SMEs are disproportionally affected by the economic disruptions of the COVID crisis and many more women are losing their jobs.
Due to the COVID-19 crisis, women entrepreneurs around the world are suffering large setbacks with new data about the disproportionate effects of lockdown measures on women-led SMEs emerging. In several Sub-Saharan countries, about 60% of women-led small businesses have lost their sources of income, three times more than men-led businesses and globally, women-owned SMEs are more likely to close their business than male-owned businesses, according to recent World Bank-led research.
“Entrepreneurship is central to the economic empowerment of women, especially in developing economies. Actions and support, such as by We-Fi’s recent round of financing, reaching women entrepreneurs in this time of need will help re-establish their roles as engines of inclusive economic growth”, says Pangestu.
Mathew Haarsager, chair of We-Fi’s Governing Committee, says he is pleased to see their partners preparing such strong proposals to support women-led SMEs. He says projects to leverage digital technologies, support digital skills-building and identify new business opportunities that may arise as a result of the pandemic will benefit so many women-led SMEs during this crucial time.