Supporting women entrepreneurs good for all of us – Here’s how

Support for women entrepreneurs is important although they made much progress over the last decade.

They still face a number of challenges and as the public and private sectors work together to build a more inclusive economy, their collective goal should include the creation of an enabling environment for women entrepreneurs.

Issues such as economic inclusion provides transitions into broader issues, such as gender equality, the socioeconomic empowerment of women and even issues of gender-based violence, says Gugu Mjadu, executive manager for marketing at Business Partners Limited.

“Tackling these issues will involve the dismantling of several structural obstacles and gender biases, which continue to perpetuate outdated systems of thinking about the role of women as well as that of female entrepreneurs in particular in South African society.”

Lack of access to finance is one of the challenges for women entrepreneurs who wish to enter the market or grow their businesses.

Lack of access to funding and business finance continues to thwart the success of women.

Mjadu says experts determined that this lack of access comes from the perception that lending to women is riskier, a lack of understanding around gender-specific challenges faced by entrepreneurs and stifling legal and regulatory frameworks.

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Financing gap for African women

African women face an estimated US $42 billion financing gap across business value chains according to the African Development Bank Group and an extensive report published by the department of trade, industry and competition, shows that only seven out of 170 women who were surveyed in four provinces were familiar with the available financing options for SMEs.

This evidence points to the fact that inequality in business finance is a multi-faceted challenge. Mjadu says you cannot take advantage of an opportunity if you do not know they exist.

Therefore, any viable solution needs to include an extensive national awareness campaign.

However, a long-term solution lies not only in equipping financial institutions and independent financiers with gender-informed policies, she says.

“It is also about granting women access to financial literacy programmes. Putting together a business plan, understanding the long-term impact of financing and learning how to manage cashflow are the fundamental aspects of business finance that aspiring women entrepreneurs in particular, need access to.”

Mjadu says in addition to structural disadvantages, women entrepreneurs also face deeply entrenched gender biases.

A study conducted by the Vaal University of Technology identified gender discrimination based on biases to be one of the most prevalent challenges facing South African women.

Getting past traditional images

The traditional image of the ‘male breadwinner’ has exacerbated this reality, when in fact, a study by Stats SA revealed that as of 2021, over 40% of South African households were headed by females.

Women, therefore, who bear a large proportion of caretaking and child-rearing duties, face additional pressure upon trying to enter the SME sector due financial strain from difficulty in accessing business finance or even market opportunities as women.

“Gender bias is often difficult to quantify due to its insidious nature, but it poses a significant threat to women who want to become business pioneers.

“It is precisely because women are discriminated against in a male-dominated business world that intentional initiatives need to be introduced in order to support women to start and sustain their own businesses,” explains Mjadu.

She says a solution will be to build networks for female entrepreneurs such as those that already exist on social media.

“Aspiring female entrepreneurs are encouraged to join and interact with these types of platforms, not only to add to the discussion, but to lean on business advice that stems from the unique female perspective.”

The lack of training and education for women in South Africa also presents a challenge for women wanting to start their own businesses.

Mjadu says many female entrepreneurs who start and build businesses in the microenterprise and informal sector reach a plateau from which they cannot progress due to their limited access to education and training.

She says this is particularly true in the information and communications technology (ICT) and science, technology, education and mathematics (STEM) industries which are notoriously male dominated.

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Entering ICT and related industries

A report by PwC found women occupy less than 20% of the jobs in the ICT and related industries.

“Women who do not have access to formalised training in these areas will not easily be able to leverage the opportunities that lie within the digital technology space.”

Access to training and education opportunities remains one of the most prominent topics in South African discourse around the importance of developing female entrepreneurs.

The solution, as we are beginning to see, lies in community-based ICT and STEM programmes, supported by government and the private sector, she says.

“The push to get more women into these programmes needs to be initiated at school level by helping South African teachers and role-players across the board to identify potential talent and opportunities to develop gifted young girls.”