London Business School’s 2021 Social Impact Conference invited Esther Dassanou, Manager at Affirmative Finance Action for Women in Africa, African Development Bank Group (AFAWA), Oluseun Onasoga, Executive director at Access Bank Rwanda and Mbabazi Zakhia, Entrepreneur – managing director at Prime Bakery and Cafe, to a panel discussion moderated by Iris Steenkamp, PhD student in Marketing at London Business School.
Women are not financially supported to meet their economic potential
Both Esther Dassanou and Oluseun Onasoga agreed that women are key contributors to the economy in Africa, and with sufficient resources, could create much more value. Dassanou highlighted that the continent has been on a growth trajectory, even throughout the COVID-19 pandemic. However, a $42 billion financing gap still exists for women. The Affirmative Finance Action for Women in Africa (AFAWA) initiative is committed to reducing the financing gap by working with financial institutions and governments to address the key challenges facing women entrepreneurs in Africa.
The $42 billion gap represents a huge market opportunity for financial institutions and a reliable one as women are more likely to repay their loans. Access Bank Rwanda pivoted its focus in 2006 to better service women in business through gender empowerment programmes. According to Onasoga, supporting women entrepreneurs is a win-win for the bank as they offer a sustainable income and are generally loyal customers. Dassanou echoed Onasoga mentioning, “research has shown that financial institutions involved in this journey have seen not only great returns, but (also) a very healthy portfolio”.
The importance of mechanisms to support financial inclusion
Women entrepreneurs are diverse and face different obstacles when it comes to fulfilling their potential. The Access Bank’s gender empowerment programme aims to address this issue by creating a specific model for each individual customer, no matter their circumstances.
A survey conducted by AFAWA, UN Women and ImpactHER found that women-led businesses were more vulnerable to closure during the COVID-19 pandemic, due to women’s limited access to finance, shifts in consumer behavior, and the increase in women’s household care responsibilities as a result of extended lockdowns.. As digitisation accelerates, women entrepreneurs can think about how to position themselves in the digital world, and this is where educational programmes offered by AFAWA and Access Bank Rwanda can play a key role.
Mbabazi Zakhia is a beneficiary of one such programme. Zakhia started her partnership with Access Bank by becoming one of the first 50 women to participate in the empowerment programme in 2020. The Bank supported her to access the capital needed to start a successful business and provided her with an education on financial literacy.
The pandemic has heightened the importance of digital literacy for female entrepreneurs. Onasoga suggests that as businesses move online, the use of digital tools and online technology has become more important for women than access to finance. Lockdowns and restrictions on in-person meetings has meant that the creation of a digital space where the bank can continue to interact with and help customers is essential.
How can students help?
“There’s a lot of room for innovation, whether it’s via digital financing whether it is via direct banking, whether it is in the form of….training can be provided to women entrepreneurs,” Esther Dassanou.
Dassanou suggests that there are many opportunities for students to engage with the issue of gender inclusive finance. She highlights research as a key focus area, pointing to the necessity of disaggregate data to inform decision-making and new policies. Onasoga echoed this adding that students should be thinking about the continuous opportunities down the ladder, stressing that policies promoting gender equality are critical but still require innovation and further development.
Driving social and economic change in Africa through gender-inclusive financing was part of the Social Impact Club at London Business School’s flagship conference, Reinventing the Mainstream. The Wheeler Institute for Business and Development is delighted to collaborate with the students who organise this event every year – calling on businesses to prioritise and take ownership of their social and environmental responsibility with immediacy and materiality.
Yan Hou (MBA2021) is the Co-Chair of the China Business Forum 2020 at London Business School. She co-led the movement of the forum to an online format in light of the COVID-19 pandemic, expanding the forum’s international influence and setting example for the online conference at LBS. Prior to LBS, Yan was a Senior Associate at PwC Boston and completed an MBA summer internship with a leading VC firm in China. She is an intern for the Wheeler Institute, contributing to the creation of content that amplifies the role of business in improving lives.