As part of efforts to position women to enable them to benefit from the African Continental Free Trade Area (AfCFTA), companies have been asked to invest in women directly by integrating gender policies and practices with global diversity.
This includes considering women’s personal safety when determining working conditions and hours or how agricultural farmland is distributed to households near mining sites to ensure that women can use and benefit from the land.
Speaking on the theme ‘Gaps and Opportunities in Financing SMEs’ and ‘Women Empowerment, president of Chartered Institute of Bankers (CIB), Patricia Sappor said: “gender considerations also need to be included in the development of new technological products and services; how and where these are sold or distributed to women.”
She further lauded banking institutions for their gender-sensitive policies. “It is good news commercial banks are integrating gender as an agenda in their sustainability programs.”
She added that by way of empowering women one would expect banks to set up gender desks with the view to go the extra mile to identify and prioritize targets of potential women borrowers emphasizing that this would be a huge step in identifying financial solutions.
Trade Finance solutions for African women-led MSMEs
Ms. Sappor indicated that AfCFTA presents regional trade opportunities to women-led Micro Small and Medium scale Enterprises (MSMEs) which would assist them to gain an understanding of basic trade finance solutions like documentary collection (documents against acceptance, documents against cash), letters of credit (sight and deferred) stand-by letters of credit and various forms of guarantees.
“The prevalent method of payment commonly used by the informal sector is advance payments which are done through the banks on a limited scale because of regulatory restrictions. It is not common for women traders to carry huge amounts of cash across the borders to engage trading partners in other countries. The risk involved cannot be over-emphasised,” she said.
Direct credit from suppliers rather than obtaining bank credit
To promote intra-African trade Ms. Sappor noted that suppliers must offer credit to buyers and financial institutions must provide guarantee schemes to facilitate suppliers credit scheme amongst MSMEs in Africa. Exim guarantee companies and Development Financial Institutions (DFIs) in Africa would have to tailor programmes aimed at empowering women-led MSMEs.
Ms. Sappor urged banks under AfCFTA to partner with institutions involved in promoting small scale industries and MSMEs to build their capacity to move into safer methods of payments through the banks. “We would expect grants for such financial literacy capacity building being channeled through commercial banks and other industry and trading associations for such purposes,” she added.
Ms. Sappor then asked that African Development Bank must give financial support to women and also hold capacity building training to enable them leverage digital technologies in the financial and production spaces.
Affirmative Finance Action Programmes
Ms. Sappor, in her speech, lauded the Affirmative Finance Action for Women in Agriculture (AFAWA) by AfDB to support women-led Farmers Based Associations (FBAs) and MSMEs to promote agriculture in certain African countries. She however called for more of such programms as they will help women empowerment. “More of such programmes by Development Banks in African countries would be needed to empower women benefit from AfCFTA.”
Ms. Sappor explained that “commercial banks have come out with product programmes based on the asset conversion and cash-flow cycle of the transaction and no reliance on security as part of the structure. These facilities are for contract finance, LPO Finance, Invoice finance and Inventory / Stocks Finance.”
She explained that “typically, these product programmes have been designed for local transactions. Commercial banks would now have to develop product programmes geared towards supporting the intra-Africa trade amongst MSMEs.”
She further encouraged women to build their capacity in trade finance products and build their skills in digital technology.
“Enhance their knowledge in tariff regimes for various import/export products traded imported or exported out of various African countries. Extension services must also be provided for women in manufacturing and other processing activities in the form of how to comply with standards both locally and internationally which will enhance marketability of the product in and outside their home country under AfCFTA,” she said.
She advised women to align themselves with women-based associations so that they bid for contracts as an association for the benefit of the several MSMEs. She further urged government to “develop training outreach specifically targeted to groups of women active in micro-enterprise, particularly in basic finance, accounting, management, and marketing”
Training courses that are offered to women by governmental and non-governmental organizations should focus primarily on technical skills. “Government should improve access to labour saving machinery especially to women farmers and entrepreneurs by setting up plant pools that could be set up in districts and communities where it will be more accessible to women,” she added,
