This archive report was first published on 1 September 2019.
On a typical Sunday in August 2019, businesswomen gathered in Nairobi for a networking event, highlighting the growing importance of women in entrepreneurship. However, a study by Viffa Consult has shed light on the challenges faced by these women in accessing finance.
According to the research, women with undergraduate education finance their businesses through bank loans, retain profit and personal savings, but those with lower training rely on mobile credit, investment clubs, friends, and relatives.
The study found that access to finance was ranked second only to harassment by government authorities as a challenge, with market access ranking third. Notably, those with turnover below Sh5 million had the most difficulty accessing financing, with 78.57% of respondents citing lack of collateral and informality of their enterprises as the main reasons.
Interestingly, both graduate and non-graduate women entrepreneurs were found to be involved in investment clubs, friends, and family networks to gain business insights, despite relying on different sources of finance.
The type of challenges faced by women entrepreneurs varied depending on turnover and type of business. For instance, women in agriculture cited lack of information, access to market, and finance as their top challenges, while those in retail with annual turnover of less than Sh500,000 faced harassment by government authorities as their biggest challenge.
As the report noted, women entrepreneurs in design, media, entertainment, hospitality, education, tours, and travel, and real estate faced gender-based discrimination as their biggest challenge.
Published on September 1, 2019, the study highlights the need for targeted support and financing options for women entrepreneurs in Kenya.
