African Development Bank’s Affirmative Finance Action for Women in Africa (AFAWA) is investing in women, accelerating Africa’s progress toward gender-inclusive economic growth

Africa is undergoing a fundamental reset in mindset toward investing in its women entrepreneurs. For too long, too many commercial banks and other financial institutions have been on the wrong side of business practice when doing business with Africa’s women-led small and medium enterprises.

Africa’s women entrepreneurs face an estimated $42 billion financing gap compared to men. Across the continent, there has been a misperception that women are not suitable candidates for loans – a lack of collateral and finance savvy lead justification for turning women entrepreneurs down for financing.

Fact is, numerous studies have shown that women in Africa, as in many places worldwide, are a better credit risk for microfinance than men, and are more trustworthy - and by a wide statistical margin, women produce higher repayment rates than men.

The African Development Bank Group created the Affirmative Finance Action for Women in Africa initiative, or AFAWA, to reduce that gap by increasing African women’s access to financing. In under two years, AFAWA has secured more than $1.5 billion in Bank-approved investment for Africa’s women-led small and medium businesses. This financing is a pillar of AFAWA incentivizing financial institutions to invest in women, and so far, we’ve unlocked this financing to more than 7,000 women-led small and medium enterprises. AFAWA is accelerating progress by advocating that women-led businesses are engines of African economic growth worth financial support and are suitable for banks’ bottom lines – after all, Africa has the highest percentage of women entrepreneurs in the world...Read more on AfDB

Source: AfDB