Session 4: Sustainable financing systems: some references

Expert Workshop
"Women: Source of Wealth and Job Opportunities"

11-12 April 2005, Tangier (Morocco)

Access to finance is one of the major problems faced by women entrepreneurs. Studies have shown that they are less likely than men to apply to financial institutions, and that they are more likely to use their personal savings to set up a business and their own capital to run it. However, as they often run small businesses, they also have more limited financial needs. In fact, experience shows that women are more present than men in the services and retail sectors. This might explain their difficulties in obtaining finance, since these two sectors are often regarded as higher risk ones by financial institutions. Women's limited access to financial services might also be explained by the lack of guarantees offered and by the attitudes of bankers. Meanwhile, because their activities are mainly commercial ones, the women in the informal sector rely heavily on micro financing. Over the last thirty years, many of them have had the chance to obtain a micro-credit, which has allowed them to reduce their vulnerability and in some cases to escape from poverty.

The Monterey Conference on Financing for Development (United Nations, 2002) addressed the question of women's access to financial resources. It recognized that the number of businesses owned by women is constantly rising across the world, and that due to recent changes arising from globalization, small and micro-businesses belonging to women are making an increasing contribution to the economic and social development of their countries. However, the contribution of women remains limited by the difficulties they face in obtaining finance. The conference emphasized the need to provide women with wider access to financial resources and services, since micro-financing, the form of credit most readily available to women, cannot be seen as a panacea for their economic promotion.

In order to set up sustainable financing systems which make possible the creation of businesses of all sizes, and also their growth, the micro-credit system should be integrated into the financial systems, and women should also be granted access to financial services which go beyond micro-credits. Some have talked of access to `macro-credits'.

Questions for the session: What lessons can be learnt from the experiences of financing women's economic activities? How can we improve women's access to financing in order to set up or expand their businesses, especially in the profitable innovative sectors? To answer these questions, the experts need to:

1. Emphasize the opportunities and the major stumbling-blocks for women entrepreneurs seeking finance