Financial inclusion for Africa’s women entrepreneurs: the key to boosting Africa’s economies

5 Mar 2021
Financial inclusion for Africa’s women entrepreneurs: the key to boosting Africa’s economies

Creating female-centric financial products and solutions for Africa’s power-force of women entrepreneurs is gaining momentum as a core focus for banking and financial services industries on the continent. Financially empowered women hold the key to boosting Africa’s economic success. CR2, a world leading vendor in the Digital Banking platform market, providing Digital, Self-Service and Payments solutions to banks across Africa, is proud to partner with banks who are actively supporting female-centric initiatives.

While Africa has the world’s highest proportion of female entrepreneurs, many are still marginalised when it comes to the provision of banking and financial services that match their needs and help grow their small businesses.

Barriers to financial inclusion include lower levels of education and financial literacy, lack of decision-making power within households, lack of regular income, lower rates of mobile ownership, and societal and legal restrictions.

But there are signs of change on the continent, including a growing number of women entrepreneurs entering the fintech space, and proactive steps from leading financial institutions to drive inclusion.

Martha Mghendi-Fisher is the founder of African Women in Fintech and Payments, a networking platform for women in banking, fintech and payments in Africa. She points out that women have traditionally been the backbone of many African economies. “Women have traded, financed and done a lot of things that are directly linked to fintech. Think about ‘chamas’ [informal savings investment cooperatives], or what is now referred to as table banking. It is a financial service, the only difference being that it wasn’t digital,” Mghendi-Fisher told news portal Platform Africa.

She says it isn’t surprising that a growing number of African women are now entering the fintech space – as both entrepreneurs and in leadership positions within the industry where they are shaping services and solutions focused on women.

We are seeing evidence of this progress too. Our customer, Standard Bank South Africa, reports that women comprise 60 per cent of its permanent workforce, and 50 per cent of managerial positions. Another leading customer – Standard Chartered Bank – is actively addressing the vital role of women in fintech in Africa through its Women in Technology Incubator programme in Kenya, in partnership with @iBizAfrica Centre at Strathmore University. As Africa’s leading incubator programme for female-founded businesses, it strives to promote inclusion and diversity in technology and entrepreneurship, and helps entrepreneurs develop their skills.


Moves for inclusion

In sub-Saharan Africa alone, around 35 million women are excluded from financial services, often because they aren’t able to meet compliance and regulatory procedures. Many of these women don’t have the formal documentation needed to open accounts, and lack the traditional collateral required to secure loans. While some countries like Liberia, Ghana and Malawi have addressed this by creating collateral registries that recognise a broader range of assets, further steps need to be taken to eliminate these barriers of entry – particularly the creation of gender-sensitive products and services.

The industry stands to significantly increase its bottom line by addressing banking’s gender gap: female financial inclusion – particularly the promotion of financial literacy, digital banking, and access to credit – will trigger economic growth and increase success rates for women-owned SMEs.


Digital empowerment

The World Bank’s Global Findex Database shows that in 2017, 65 per cent of women had a bank or mobile savings account, compared with 72 per cent of men. As Kristy Duncan, founder and CEO of Women in Payments, points out in an article on the global networking platform’s website (, this financial exclusion denies women access to credit and debit cards, ATM access, government payments, and relegates them to use cash as their only means of transacting.

“Switching to digital payments can increase access to financial products and reduce opportunities for theft and coercion, thereby increasing financial independence and empowerment,” says Duncan.

A World Bank study in Kenya found that access to mobile money services enabled women-led households to increase savings by more than 20 per cent, meaning they could grow business or retail activities; and helping to reduce extreme poverty among women-headed households.

“Studies have shown that when a woman is given a savings account, she can use it to build savings, spend more on her children’s education and nutrition, and invest in her business. Financial empowerment, especially for women, can go a long way to bringing people out of poverty, and we in the payments industry have a big role to play,” says Duncan.

At the end of 2019 Standard Bank partnered with UN Women and joined forces in helping women farmers across Malawi, Nigeria, Uganda and South Africa to increase productivity and incomes by implementing and utilising modern technologies, including financial literacy sessions.


Removing barriers to borrowing

A growing number of banks across the continent are taking active steps to make borrowing easier for women entrepreneurs. Kenya’s Equity Bank has business training, flexible collateral and repayment periods linked to its range of women-focused credit products, and in Uganda Centenary Bank offers literacy and digital training as part of its SupaWoman Club.

Just last month another of CR2’s customers – Nigeria’s Access Bank – Africa’s largest retail bank with 40 million customers – launched its LSETF-W Initiative Loans in partnership with Lagos State Employee Trust Fund (LSETF) to address and tackle financing gaps for female businesses and give them the tools to thrive. The loans have a low interest rate, require no fixed property collateral and offer an extended repayment period.

Additionally – and equally important – Access Bank also extends business support services and digital payment solutions to women entrepreneurs. “We understand the nitty gritty of doing business which goes beyond just having capital,” says Ayodele Olojede, the bank’s group head for emerging business. She says the bank offers advice on proper business structures, creating an online presence, mentorship, and access to market and networking opportunities so female-led businesses can grow and succeed during the first five years of operation.

As a leading provider of digital, self-service and payments solutions, CR2 enables banks to increase financial inclusion and digital empowerment among women with a banking platform that offers capabilities such as digital onboarding and a range of design tools to develop, launch and promote products and services that serve and engage with the banking needs of women in Africa today.

Financially literate entrepreneurs make better informed decisions, leading to business success and ultimately greater economic prosperity for the continent as a whole. The fintech industry has an important role to play in acknowledging and practically addressing issues around female inclusion – it’s a win-win situation for all.