Advancing Women’s Economic Power through Financial Access and Digital Technologies

Over 74% of women in sub-Saharan Africa are employed in the informal sector, and only 33% hold a formal bank account. While informal employment can offer flexibility and options when finding a formal job is difficult, informal employment can lead to significant vulnerabilities: workers do not benefit from public social protection schemes for health, unemployment, and pensions, heightening their risk of poverty and reducing their resilience to crises like the COVID-19 pandemic. The additional domestic duties also sometimes hinder the pursue of economic opportunities, hence creating a vicious circle.

For Africa’s female entrepreneurs looking to start or expand their business, access to capital, like loans or through credit, is a major hurdle. Only 15% of loans to small and medium-sized businesses in the region go to women-owned ventures. Cultural barriers, such as lack of property or land ownership, often prevent women from meeting loan requirements because they don’t have the collateral banks believe they need to give them a loan. Ironically, despite demonstrating higher loan repayment rates than men, women-led businesses are often perceived as riskier by financial institutions. This has created a staggering $42 billion finance gap for women entrepreneurs on the continent, demanding immediate action.