Amidst a tough business environment, access to finance is perceived to be the biggest challenge facing women entrepreneurs in Kenya. This challenge of financing actually cuts across the board and can be solved by understanding it.
Women entrepreneurs in Kenya say that financing their business is the biggest challenge they face. It’s the main problem faced by all entrepreneurs and, in a sick way, shows how much stride we’ve made in gender equality.
This has forced a majority of women to rely primarily on chamas to get capital for their businesses. Chamas though can’t offer an enterprise much in the way of expansion. This created a gap for microfinance to fill. It has done well and become part of the common parlance in Kenya. Nevertheless, the ambition of female entrepreneurs in this country has turned out to be beyond the capacity of microfinance institutions.
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The Government has stepped in over the last few years with a handful of initiatives to finance women’s businesses. This has proven inefficient. Maintaining capital in the hands of the public sector is retrogressive and the culture of corruption stymies any progressive effort. If the Government (National or County) is directly funding entrepreneurs why would we expect the “Serikali Saidia” mentality to end?
Failure of these two has called for increased options to avail capital. A number of investors, local and international, have taken to task. While we women entrepreneurs are thankful, they too have fallen short of delivering. Some are perpetuating the grant approach (Aid money everyone) and most can only take up a few businesses at a time.
It appears hopeless but it’s not. There is a tap that never runs dry. Banks can meet this need but they’ve been slow to take up the mantle. Just as they were slow to allow the common mwananchi to open a bank account.
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Of course there is the problem of formalizing the economy. This means there is a lack of records to convince banks to lend to you as an entrepreneur. Kenyan banks are still guilty though of perceiving entrepreneurship as high risk hence they put up high costs on the few loans they give. Women in Kenya have also complained about long waiting periods and the need for a male guarantor.
Banks in Kenya need to have confidence in female entrepreneurs and support their initiatives with a long term view. These entrepreneurs are itching to join the action as entrepreneurship in Kenya shifts from filling in for unemployment to taking advantage of opportunities.