AFAWA, AFI to boost financial inclusion for African women entrepreneurs

The African Development Bank’s Affirmative Finance Action for Women in Africa program (AFAWA) and the Alliance for Financial Inclusion (AFI) have entered into a new agreement in a bid to increase financial inclusion for women-led enterprises across Africa.

At a roundtable dinner held on the sidelines of the International Monetary Fund (IMF) and World Bank Annual Meetings on October 12, the Bank and Alliance leadership presented the AFAWA-AFI partnership to more than 70 guests, including 50 representatives from Ministries of Finance and Central Banks, and 10 of whom are current ministers or governors.

According to a press statement by African Development Bank, AfDB, the $4-million program supports policymakers, regulators, and other stakeholders to create financial inclusion-friendly policies that benefit small and medium-sized businesses run by African women.

“With financial inclusion high on the agenda of African countries, many nations are setting concrete targets for women’s financial inclusion,” it stated.

It further stated that evidence-based support from partnership institutions could help African governments establish an enabling environment.

A McKinsey study predicts that Africa could lose out an estimated $316 billion in GDP by 2025, if Africa’s women are unable to access finance.

“Through this project, we expect to yield improved data for policy decision-making and improved technical capacity among policymakers at the institutional, national and regional levels. These efforts will lead to an enhanced financial policy and regulatory environment for women in business in Africa,” said Swazi Tshabalala, Senior Vice President, AfDB.

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AFAWA and AFI will implement the joint program across 35 countries represented by Alliance member institutions in Africa, and with regional organizations Union économique et monétaire de l’Afrique de l’Ouest and la Communauté économique et monétaire de l’Afrique centrale.

Also in support of the new partnership were Beth Dunford, Vice President for Agriculture, Human and Social Development, AfDB; Malado Kaba, Director for Gender, Women and Civil Society, AfDB; and Esther Dassanou, Manager of the AFAWA initiative.

Representing the AFI management unit, Rogério Zandamela, Mozambique’s Central Bank Governor as African Central Banks, they are very pleased to see the deepened cooperation between the AfDB and AFI since signing a memorandum of understanding in 2017 in Abidjan. “I commend the leadership on the launch of the program.”

Last year, the Bank identified countries with the most progressive policies to accelerate financial inclusion. The countries are the Democratic Republic of the Congo, Morocco, Nigeria, Rwanda, Senegal, Zambia and Zimbabwe as case study countries.

It based its selection on having made significant progress towards the financial inclusion of women-led small and medium enterprises, best practices to inform the financial inclusion harmonization process and providing policy guidance to accelerate this targeted access to finance.

“For example, in the last decade, Senegal has seen an impressive 900 percent increase in women’s financial inclusion, with the Democratic Republic of the Congo realizing a 700 percent increase in the same period,” the statement stated.

Representatives from the IMF, which recently launched its first Gender Strategy, told event attendees that statistical research and collaboration would aid the new partnership, achieve its goals.

“We recognize that reducing gender disparities, especially with access to finance, leads to exponential economic growth. We encourage all countries to publish gender-disaggregated data and to find synergies with new emerging sectors,” said Ratna Sahay, the International Monetary Fund’s Senior Advisor on Gender.