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Expanding the range of viable financing options available to women entrepreneurs


Women entrepreneurs do not find suitable financing products in the market

Most women entrepreneurs require affordable short-term working capital as their core financial product. Initially, they rely on savings, friends, family, and credit groups. As their business grows, their financing needs to increase, and they may require up to $50,000 every 3 to 6 months. However, suitable financing options become scarce at this stage, even if they have held bank accounts for 1 to 3 years.

Available financial products are very limited

To understand the loan products available in East Africa, we conducted a mystery shopper study in 11 banks across Kenya, Tanzania, and Uganda. Of the banks surveyed, 54% had a presence in all three countries, allowing us to compare product offerings across different locations.

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Our assessment revealed the following products:


Secured term working capital loans




Strict collateral requirements, at least 120% value of the loan request


Bias toward immovable property, which is usually worth 5x to 10x more than the loan request. Lack of flexibility to consider other assets

During mystery shopping, we have also discovered several challenges faced by women entrepreneurs:


1. Limited nature of financial products designed by banks. Due to the stringent conditions such as risk and return expectations under which financial institutions operate, there doesn’t seem to be enough room for financial institutions to innovate to accommodate the needs of women entrepreneurs.


2. Limited use of gender-disaggregated data in the design of financial products. There was little to no evidence that financial institutions designed credit products using gendered data or any specific human-centered design mechanisms.

3. Limited growth of financial acumen of women entrepreneurs. Women entrepreneurs did not have the required financial advisory support to approach financial institutions with clear financial needs. Some women had assumed expectations that banks would have a full understanding of their businesses and the specific challenges they faced which was not always the case. These financial conversations typically ended in some form of frustration for women entrepreneurs.


Based on our findings, we recommend that financial institutions consider the following strategies to better meet the needs of women entrepreneurs:

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Design innovative digital products that can enable ease of access to working capital, e.g. Loop by NCBA bank.

Develop innovative credit scoring to include previous credit performance on personal and business loans acquired such as mobile money loans, and previous loans with microfinance entities to assess the risk profile and provide more favorable terms for women entrepreneurs.

Reduce restrictions on invoice discounting by implementing double credit checks for loan applicants and their customers.

Use fixed deposit periods to lower interest rates on 2-year loans, making loans more attractive.

Provide education on other working capital products such as overdrafts, letters of credit, and invoice discounting, rather than relying on term loans as the default option.

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Proposed Tools:

To this end, we have proposed a set of tools to assist financial institutions in providing clear, accurate information about loan products to potential borrowers. These tools include:

  • Have a list of minimum acceptable information to be included in loan product brochures

  • Include a list of credit scoring platforms and bureaus in East Africa

  • Product design recommendations for cash-secured working capital loans

  • Boilerplate materials on different working capital products

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