This archive report was first published on 12 November 2019.
On November 12, 2019, Catherine Njoroge wrote in Business Daily Africa that banks must focus on the impact of women's businesses in Kenya.
Africa leads the world in the number of women who choose to become entrepreneurs, with more women than men opting for this path. In Kenya, women own 33 percent of all small and medium enterprises (SMEs), which is approximately 517,000 businesses, according to an International Finance Corporation (IFC) report.
Women running businesses in Kenya have expressed that financial institutions must correct their misperceptions about female consumers. They believe that the female economy, comparable to the male economy, is laden with attitudinal differences that can generate positive returns with minimal investment.
One common misperception is that women's attitudes to finance differ little from men. However, women are a more cautious lot when it comes to risk and reward, which means they have a higher propensity to saving and guarantee a fluid base for banks.
Women value deep relationships more and want a relationship with a bank, as compared to men who are transactional and easily impressed by products. Women are magnetised by experiences and consequently act on the recommendations of peers and friends.
Another misperception is that all banking products for the female economy have to be feminized. However, most female businesspeople feel that the real value lies in shared impact like improved access to financial services, knowledge, and networking opportunities.
The opportunity cost for banks in this space is exemplified by the existing credit facility gap, which is approximately Sh28.7 trillion ($287 billion) for women-owned SMEs. To make it work, women have relied on informal sources of finance, including their own savings, and loans from friends and family.
According to Catherine Njoroge, a successful women's programme needs leaders of those institutions to be involved, aligned, and championing those programmes, followed by across-board internal buy-in. They also feel the need to see a deliberate effort to ensure all employees, especially male employees, are involved and see the value in a women's programme.
