Financial institutions have been encouraged to reassess their lending practices and provide greater financial support to women and women-led businesses, a crucial step towards bridging the persistent financial gaps in local economies.
At the Aggrey-Fraser-Guggisberg Memorial Lectures, themed “Her Money, Her Power: Making Finance Work for Women,” the Regional Executive at Ecobank for Central, Eastern, and Southern Africa and Managing Director of Ecobank Kenya, Mrs. Josephine Anan-Ankomah, stressed the need for banks to revolutionize their approach to funding women-owned businesses.
Despite women’s growing influence in the business world, they continue to face significant obstacles in accessing finance, limiting their ability to contribute fully to economic growth. This disparity has far-reaching consequences, hindering the potential of women-led businesses to drive innovation, create jobs, and stimulate economic development.
Mrs. Anan-Ankomah emphasized that traditional banking models often prioritize collateral over potential, making it challenging for women entrepreneurs to secure the necessary funding to grow their businesses. She advocated for policy reforms, innovative financial products, and a cultural shift in banking to ensure women entrepreneurs receive the necessary capital to scale their businesses and drive inclusive economic development.
“Women-led businesses grow incrementally rather than exponentially. The irony is banks are missing out on a golden opportunity,” she stated.
“Women entrepreneurs have proven to be more reliable borrowers. They have the lowest Non-Performing Loans ratio yet because traditional banking models prioritize collateral over potential, many promising women-led businesses never get the capital they need to thrive,” she added.
By addressing these financial disparities and providing women-led businesses with greater access to capital, banks can play a critical role in promoting economic growth, reducing inequality, and empowering women entrepreneurs to reach their full potential.
