Promoting robust financial literacy will play a pivotal role in driving the growth of women-led Small and Medium-Sized Enterprises (SMEs) and their valuable contributions to the national economy, according to experts participating in the SME Banking Webinar on financial literacy and capacity building as a tool of wealth creation for women-owned SMEs organised by UMB Bank.
Current data reveal that sub-Saharan Africa boasts the highest concentration of women-owned businesses globally, with approximately one-fourth of women venturing into entrepreneurship; in stark contrast to the average of 6 percent in Europe. Moreover, in Ghana it is estimated that an impressive 44 percent of businesses are owned by women.
To deepen the impact of this demography on the economy, an Associate Director at PricewaterhouseCoopers (PwC), Gifty Appiah, said it is imperative that small businesses pay keen attention to their financial book-keeping in general, while placing particular emphasis on taxation.
“One key thing is that you cannot talk about financial literacy without taxes. Tax education is key. The key thing is that you should not pay more or less than what you are supposed to pay; and that requires knowing what you are supposed to do under the tax laws.”
She added that becoming conversant with the tax laws will afford businesses the knowledge to take advantage of numerous incentives provided within them.
Chief Executive Officer of Fio Enterprises Limited, Adelaide Ahwireng, stated that owners of small businesses need to learn the art of negotiation to surmount the barrier of limited access to finance. This, she said, must be complemented with credibility.
“We hear a lot about the difficulty business, especially women-owned businesses, face in accessing finance; but this should not be the case. You should be able to show that you can repay a facility and ensure you maintain credibility,” she said, adding that efforts must be made to build and maintain professional relationships. “Make your banker your friend,” she further stated.
The Ghana Revenue Authority (GRA) Board executive added that while women-business owners should employ financial professionals to ensure they operate under globally-accepted best practices, it is necessary that they gain for themselves an understanding of financial concepts; even if it is in a semi-formal setting.
“Businesses should have at least one financial expert in their fold, but the business-owner must also endeavour to gain some financial literacy,” she said.
Co-founder of Reroy Cables Limited, Dr. Kate Papafio, placed particular emphasis on partnerships and value addition – arguing that with increased globalisation, businesses should endeavour to expand their frontiers through synergies.
“Despite most businesses starting small, the goal should be to look beyond this and take advantage of the multiple opportunities that are available, for instance, through the African Continental Free Trade Area. This can only be achieved if they do not work in silos,” she noted.
The founder and CEO of First Choice Hair & Beauty, Faustina Adofo Adjagar, emphasised the crucial importance for businesses to actively listen to market feedback – particularly from their clients.
“Understanding the needs and preferences of customers is essential for maintaining a competitive edge and ensuring long-term success. By attentively listening to market feedback, businesses can gain valuable insights into customer satisfaction, identify areas for improvement, and make informed decisions that align with the demands of their target audience,” she said.
Furthermore, she said businesses – especially women-owned firms – must carefully manage their finances, keeping a keen eye on expenditures and ensuring that resources are allocated efficiently as a key financial discipline.
She strongly advised against comparing one’s business decisions to those of others, since each business operates within its unique context and faces its own set of challenges.
“Relying on the decisions of others without considering the specific circumstances and dynamics of one’s own enterprise can lead to misguided choices. There is a need to exercise caution when making expenditures which could potentially jeopardise stability and growth of the business,” the entrepreneur added.
Group Chief Executive of the I-ZAR Group, Rashida Saani Nasamu, advised businesses to closely monitor market trends as a means of informing better financial decision-making.
“Keeping a vigilant eye on market dynamics, consumer behaviour and emerging industry trends allows businesses to adapt and adjust their strategies accordingly. By staying attuned to market shifts, businesses can proactively identify opportunities for growth, anticipate potential challenges and make informed financial decisions which align with the evolving needs and preferences of their target audience,” she explained.
Furthermore, she emphasised the need for improved financial literacy among women business-owners. She highlighted the role that stakeholders – including government and financial institutions – play in facilitating this process; and called for the implementation of targetted policies and initiatives aimed at providing women entrepreneurs with access to resources, training programmes and mentorship opportunities which enhance their financial knowledge and capabilities.
CEO of UMB Bank, Nana Dwemoh Benneh, said lessons from the event – which formed part of the bank’s SME Month celebration – will be taken on board to inform other engagements and product design.
“We are very pleased with the level of interaction during the engagements today and already looking forward to the next, where we will bring together key stakeholders to meet with clients to hear from them and better understand their concerns,” he said.
