By Mugure Kamau, Women’s Economic Empowerment Director & Lucy Mitei, Gender Specialist
March is recognized as Women’s Month, and 8th March set aside as International Women’s Day, IWD. This year, the theme for IWD is ‘Gender equality today for a sustainable tomorrow’. As we join the world to commemorate this month and day, it is critical to take stock of progress made in advancing women’s socio-economic agenda. The 1995 Beijing Platform for Action was a landmark visionary agenda designed to accelerate equality and opportunities for women. But 27 years later, gender barriers still inhibit women’s efforts toward economic empowerment. According to the International Finance Corporation, globally, women-owned SMEs face a $300 billion financing gap. More than 70% of women-owned businesses have inadequate or no access to financial services.
Women’s Access to Financial Services in Kenya
In the economic participation and opportunity indicator, Kenya ranked 84 out of 156 counties in the 2021 Global Gender Index with a score of 0.672, this is an increase from a 0.598 score in 2020 at a position of 114 out of 153 countries. A close look at the contextual data on access to finance shows that Kenya scored 0.25 out of 1 while women’s access and control of land was 0.50 out of 1, which was a similar score in 2020. Land resources remain a critical factor in access to financing, and though women can access and control this critical resource, this is yet to translate to increased uptake of financial services by women.
The finding on improved financial inclusion has also been affirmed by the 2021 FinAccess Household Survey, which shows that the access dimension has expanded to 83.7 percent in 2021 from 82.9 percent in 2019. However, access to formal financial services and products among women declined in 2021 compared to 2019. This is despite the efforts by the Kenyan Government in rolling out initiatives such as the Credit Guarantee Scheme which seek to expand financial access to accommodate the needs and interests of women entrepreneurs.
Bridging The Gap
As we celebrate progress made so far in bridging the women financing gap in Kenya, there’s still work to be done. Despite efforts by some financial institutions (FIs) in developing women-targeted financial products, there still exist low uptake of these products. Critical questions persist: Are these products developed in consultation with the women as consumers? Could it be a case of “pink-washing”, rather than integrating women’s agenda in the overall organization’s strategy? Or is the challenge a lack of investor-ready women enterprises? The bottom-line is that the aspirations of women entrepreneurs are equally important to those of their counterparts and there is need to continually integrate gendered solutions to remove barriers to access to financing.
What We Are Doing
To address barriers to women economic empowerment, USAID’s Kenya Investment Mechanism is using a multi-pronged gender-financing approach which involves working with FIs to adapt products and services that suit the unique needs of women entrepreneurs in various sectors. To help these businesses become investment-ready, a pool of business advisory service providers (BASPs) is addressing capacity gaps that make their businesses unattractive to FIs and other investors. Some of the common bottlenecks among W-SMEs include lack of knowledge in developing bankable business plans; lack of investor-pitching skills and unstructured business models.
To date, kenya Investment Mechanism has mobilized over $50 million to support growth of over 100 W-SMEs. The activity continues to collaborate with FIs, national and county governments, investors to #BreakTheBias and drive more investments into women-led enterprises.