Global Summit of Women 2003
Marrakech, Morocco
 

INNOVATIVE WAYS OF ACCESSING CREDIT FOR WOMEN OWNED ENTERPRISES

Sithembiso Nyoni,, Minister of Small and Medium Enterprises Development, Zimbabwe
 

Women have come a long way in terns of being recognized as credit worthy.  The tables below tell a story about how far women in Zimbabwe have moved.  Table 2 shows that by year 2000 women in Zimbabwe had overtaken the men in terms of credit worthiness, in the small enterprise development within this institution. However, this is not true of all financial institutions especially the bank. They still favor men.

When there is a crisis or disaster more often than not women are both the victims and best managers of that crisis and scarcity.  Zimbabwe is going through bad economic parch in which inflation and the cost of living makes budgeting and cash management for the poor a very challenging undertaking. 

In addition Bank interests make credit too expensive for small entrepreneurs.

Despite these challenges, women in Zimbabwe are doing amazing things.  They have not only fought for recognition in the large financial institutions like SEDCO.  Women from different sectors, government, the private sector, NGOs, and the informal groupings meet to mobilize resources to start small businesses, and to the support the on going.  They also save money together to meet social needs, children’s fees, hospital / health expenses and funerals. 
 

1. BUSINESS SUPPORT NETWORKS

-         Women in Zimbabwe have formed some of the most formidable economic survival networks.  In groups of 5-10 they collect cash on weekly or monthly basis to on – lend and support each other’s business. These contributions range from thousands to millions of dollars.
 

2. COMMUNITIES FOUNDATIONS

-         In the western region of Zimbabwe rural communities have mobilized resources to form a community foundation.  So far these women from the poorest part of Zimbabwe and their families have contributed over a million Zimbabwe dollars despite the economic hardships, food shortages resulting from the two years of drought.  The foundation staff manages the fund.  Additional funding is raised from local and international sources to grow these funds. These communities ten apply for grants and loans for their businesses.   This foundation is the first of its kind in Africa – founded and run by communities.
 

3. VILLAGE BANKS

-         These are also mushrooming throughout the countryside.  There are created, financed and run by communities themselves.  They give small loans to individual and collective businesses.  These village banks have been successful in that they build trust, dependability and self – reliance among village women and men.   In their small way communities have started viable finance institutions without outside aid.
 

4. COMMODITY ASSOCIATIONS AND PEOPLE’S SHOPS

-         My ministry supports such initiatives. In addition we encourage the formalization of commodity associations from agricultural production to value addition. E.g. paprika, sweet potatoes, horticulture, small grain, poultry and mushroom growers associations. Such associations as small millers, tailoring, home deco, crafts, oil pressing, peanut butter making, candle and cosmetic manufacturing add value for local and export markets. 

-         These commodity associations are encouraged to mobilize their own savings. My Ministry tops them up for on lending to their members.  We train them to mange both their businesses and how to service loans. In this way we strengthen people’s efforts rather than replace or overlook them.

-         These commodities associations are further assisted by my ministry to form people’s shops through with their commodities are marketed profitably but at affordable prices for ordinary people.

-         Since January, this year I have helped establish fourteen such shops throughout the country. In addition, Zimbabwean women travel all over the world to market their products.
 

5. RESTRUCTURING ESTABLISHED FINANCE INSTITUTIONS IN FAVOR OF SMEs

-         My ministry disburses its funds through a Small Enterprise Development Corporation (SEDCO).  I have managed to restructure this to abolish collateral.  But rather, emphasis is put on wealth creation, the visibility of the SME, potential for growth, employment creation and social responsibility. Creation of corruption and crime free zones within the enterprises we support is also an important criterion.

-         As seen on table 2 emphasis on, viability and social responsibility as security has encouraged more women to borrow than men.
 

6. LINKING SME’S TO BIG BUSINESSES
-         The last model is that of using big business to support and mentor small businesses.  This  has been most successful in the timber, bakery and steel industries. I have also ensured that at every level women are included and play a major role. 

-         We deliberately adopted these approaches of supporting the people’s own innovative and locally based on way of creating and accessing credit and support systems for their enterprises.

 -         This has proved more sustainable and more inclusive than imposing outside models.

-         These approaches have seen real increases in women’s economic activities, strning from rising self – employment and income generation. They imaginatively set out to overcome all three obstacles of first, providing the finances, and secondly assisting with management skills and thirdly linking entrepreneurs to an array of supportive services and resources that help ensure the success of enterprises. 

-         As I said above, Zimbabwe is going through a bad parch, but there are some of us especially women from all sectors who have chosen to focus on the good about out country.  The opportunities are amazing and together we shall make Zimbabwe and the rest of Africa Great.  Only women can do it we are doing it and we shall do it.

-         I have met great women in this summit.  Thank you for your inspirations, visions and best practices and experiences that you have shared