Newly unveiled African Development Bank’s Guarantee for Growth programme will release $3m to African women entrepreneurs.
According to a statement from the bank, this will be accomplished by working with financial institutions to enhance their ability to lend to women.
The statement read in part, “Guarantee for Growth, which receives support from the Group of Seven countries as well as the Netherlands and Sweden, has three pillars: boosting access to finance, providing technical assistance to financial institutions and women business owners; and improving the enabling environment for women’s Small and Medium-sized Enterprises.
“African women face a $42bn financing gap, which Affirmative Finance Action for Women in Africa aims to bridge. This is tied to a lack of access to collateral in the form of land and property as well as to knowledge, mentorship, and networks to grow their businesses, which are typically in the informal sector.”
AfDB noted that financial institutions in Cameroon, Democratic Repulic of Congo, Kenya, Rwanda, Tanzania and Uganda were signing on to programme.
The Guarantee for Growth programme is an offshoot of the partnership between AfDB’s AFAWA and AGF, Financial Street gathered.
The Group Chief Executive Officer, AGF, Jules Ngankam, stated, “As the implementing partner of AFAWA’s Guarantee for Growth programme, we are already observing increased appetite from banks for this innovative product that seeks to support women entrepreneurs.”
“We have recently signed agreements with leading banks on the continent who are keen to increase their women SMEs portfolio. AGF has always been cognisant of the importance of supporting women SMEs to enable them fully play their role as drivers of economic growth. We are glad the momentum is increasing and that banks are now willing to take on this particular business segment.”
According to AfDB’s Director of Financial Sector Development, Stefan Nalletamby, the signing of the AFAWA Guarantee for Growth programme with the AGF is a critical milestone for the bank to successfully deploy on-the-ground financing instruments better suited to address the financing and training needs of women-owned SMEs in Africa for the growth of their businesses.
In addition, AFAWA’s Coordinator, Esther Dassanou, pointed out, “There is urgent need to improve the enabling environment with the right regulations in place, to sustainably de-risk the segment.
“The bank will work with regulators to reform the legal and regulatory frameworks affecting women businesses’ access to finance. The Guarantee for Growth is also expected to reach an average of 18,000 women SMEs and create 80,000 direct jobs.”
AfDB’s Director for Gender, Women and Civil Society, Vanessa Moungar, added, “Donor and private sector-support for the overall AFAWA initiative is helping the bank set ambitious targets for AFAWA Guarantee for Growth programme.
