An estimated 1.5 million Sierra Leonean women operate in the micro or small business sector – a sector which accounts for 90% of the country’s economy. Women entrepreneurs create employment opportunities, contribute to domestic and export earnings, spur business innovation and ultimately reduce poverty levels. Clearly, they have a vital part to play in bringing the country back to its feet.
The playing field for men and women entrepreneurs in Sierra Leone, however, is far from even. This was true even before Ebola struck, as women have always faced huge financial, legal and social barriers to growing a successful business. In 2012 we partnered with the African Foundation for Development–Sierra Leone to address these challenges. With support from the Pratt Foundation, the COMO Foundation and GE, we established the Organisation of Women’s Networks for Entrepreneurs (OWNERS), the country’s first national network of women entrepreneurs. The network provides women with the tools and support they need to access new markets and financial services, build their networks, grow their confidence and effectively manage their businesses.
The need for OWNERS was, of course, heightened during the Ebola crisis. After severe restrictions were placed on travel and public gatherings, national borders were closed and cross-border trade halted, women members of the network struggled to keep their businesses afloat, with many diverting funds for their enterprises to ailing relatives.
OWNERS provided vital one-to-one support to members via email and telephone, monitoring their business activities, offering health advice, counselling and providing a much-needed morale boost. Despite the challenges faced by many of the women during the crisis, the network was able to maintain its membership numbers at almost 700.
With only two new cases of Ebola recorded in January this year, the fight against the disease is almost over. OWNERS has now turned its focus to strengthening women’s access to financial services, following a study which we commissioned on this issue in collaboration with the International Finance Corporation. The study was conducted across nine districts in Sierra Leone, and interviewed 222 women engaged in various types of businesses. It found that most women struggle to access the training and financing products they need to grow their businesses, including saving, credit, leasing, and pension facilities.
The report highlighted issues ranging from the inherent gender bias in the country’s cultural environment, where women struggle to control their finances and own property, to the fact that much of the country’s business legislation is oriented to medium and large-scale businesses.
On top of this, financial institutions in Sierra Leone are often reluctant to serve women entrepreneurs, generally regarding them as high risk ventures. The Foundation also knows from conversations with network members that women often lack the confidence to even enquire about loans at banks and other financial institutions.
OWNERS has taken steps to address these barriers, delivering additional financial literacy trainings and facilitating direct linkages between women and financial institutions. For example, an initial presentation by the business development arm of Ecobank, followed by one-to-one meetings with 30 members, resulted in 10 women opening new accounts.
But working with women represents just one side of the equation. Financial institutions also need to take a more active role in enabling women entrepreneurs to access the services they need to take their businesses to the next level. We believe there are several specific actions they can take which will aid this process, including:
- Increasing their product range to include products specifically designed for women, as well as providing flexible and longer repayment periods on loans;
- Allowing all types of assets to be used as collateral for loans, including both tangible and intangible assets such as patents, trademarks, copyrights and trade names;
- Applying specialised interest rates for women-owned SMEs, preferably a single digit interest rate for small loans;
- Engaging directly with women, for example by setting up regular SME-banking events for women entrepreneurs.
It is vital that women entrepreneurs are able to access the training, information and networks they need to become more confident and capable business owners, as well as the financial services they need to nourish their enterprises. Unleashing the full potential of Sierra Leonean women will help accelerate the country’s economic recovery.
Sofia Olsson is the Interim Enterprise Development Programme Manager at the Foundation.