Zim banks shun women entrepreneurs

Lazarus Sauti

Women constitute 52 percent of the population in Zimbabwe and they contribute a lot to the economy of the country.

Despite their contributions in various capacities, women entrepreneurs are finding it difficult to access financial resources from banks as well as other financial institutions.

This lack of support from banks is incapacitating their operations, hindering not only their enterprises but the economic transformation of the nation.

Erica Matikiti, an entrepreneur in Nyanga, concurs.

“It is difficult to access financial support from banks and this is stalling our operations. Many banks are not willing to support us due to various reasons such as differences in land tenure rights between men and women,” she said, adding that “as a result, women entrepreneurs are disadvantaged, with less access to credit and market.”

Matikiti is not the only one suffering as many women entrepreneurs in Zimbabwe and other states in southern Africa are facing similar challenges.

“Despite the fact that women contribute immensely to the development of the Southern African Development Community (SADC), women entrepreneurs in countries such as Zimbabwe, Malawi and South Africa among others are failing to access financial assistance from banks,” said Kudzai Manyanga, an economist.

Tapiwa Rutendo, an entrepreneur and gender activist, also said banks are not willing to support women entrepreneurs because most of them have no collateral to offer against their borrowings.

“Women entrepreneurs in Zimbabwe and other African countries often have no collateral to offer against their borrowings; thus, lenders may feel they bear very little liability of their failure when they borrow,” she said, adding that, “this is one of the reasons why access to credit by women is generally poor.”

Women activist Tsitsi Jena, however, said since women constitute 52 percent of the population, supporting them will definitely transform their lives.

“Financial institutions, especially banks need to seriously come up with effective mechanisms to ensure that women in business receive the same treatment accorded to men. The banking sector in the country should give equal access to women to a general pool of funds,” she said.

Jena added: “Banks in Zimbabwe as well as other SADC countries should also seriously consider women in business as they are better credit risk than men. Women entrepreneurs, unlike their male counterparts, are better borrowers and banks must not ignore them.”

She also said banks should in fact try to rectify the problem by establishing innovative ways such as loan guarantee schemes specifically targeted at increasing women’s access to finances and other vital resources. 

Sharing the same sentiment, Clive Mphambela, a banker and advocacy officer for the Bankers’ Association of Zimbabwe, added: “Not only are women better servers, they are also better borrowers, despite having lower access to financial services compared to their male counterparts.”

Banks in Zimbabwe and other regional countries, noted Rutendo, should play an active role in supporting women in business, and to achieve this, they should up their efforts to mainstream support to female clients as well as recruit more female financial professionals.

She added: “To effectively facilitate access to financial services for female growth-oriented entrepreneurs, banks must tailor financial instruments and provide working capital and investment finance through a dedicated line of credit.”

Rutendo significantly believes to improve the well-being of women entrepreneurs, the government should quickly open the bank for women.

“Economic empowerment of women is the hallmark for gender equality. Accordingly, the government should make frantic efforts to ensure that the women’s bank is operational since the bank is envisaged to be the nerve centre for project financing for women,” she said.

An official with one of the leading banks in the country who requested anonymity, nonetheless, said it is not true that banks in Zimbabwe are shunning women in business.

“It is not true to say banks in the country are not interested in supporting women entrepreneurs. Most banks are eager to support them to achieve the goals they aspire, but the truth is that women entrepreneurs need to first establish trustworthy relationships with banks and other financial institutions,” said the official.