On the occasion of the G20 leaders’ summit, the World Bank Group today announced the creation of an innovative new facility that aims to enable more than $1 billion to advance women’s entrepreneurship and help women in developing countries gain increased access to the finance, markets, and networks necessary to start and grow a business.
The United States initiated the idea for the facility and will serve as a founding member along with other donor countries.
“Women’s economic empowerment is critical to achieve the inclusive economic growth required to end extreme poverty, which is why it has been such a longstanding priority for us. This new facility offers an unprecedented opportunity to harness both the public and private sectors to open new doors of opportunity for women entrepreneurs and women-owned firms in developing countries around the globe,” World Bank Group President Jim Yong Kim.
“Everyone benefits when women have the resources they need to participate fully in our economies and societies. Our Government is determined to help women gain the tools they need to be successful entrepreneurs and leaders. This important investment will help women in developing countries to create jobs, build economies that work for everyone, and have a real and fair chance at success,” Canadian Prime Minister Justin Trudeau.
The Women Entrepreneurs Finance Initiative (We-Fi), the first World Bank-led facility to advance women’s entrepreneurship at this scale, will work to enable more than $1 billion of financing to improve access to capital, provide technical assistance, and invest in other projects and programs that support women and women-led SMEs in World Bank Group client countries. The goal of the facility is to leverage donor grant funding – currently over US$325 million – to unlock more than $1 billion in IFI and commercial financing by working with financial intermediaries, funds, and other market actors.
“I am happy that this initiative for women presents real added value. I want to sincerely thank everyone who worked on it especially the President of the World Bank Jim Yong Kim and Ivanka Trump and others. We can see from the example of this Women’s Entrepreneurs Finance Initiative that the G20 is not just a two-day Summit, but that the G20 is a process.And I don’t have the slightest doubt that under the leadership of Jim Kim that these will be truly valuable and productive investments,” Chancellor Merkel of Germany said.
The World Bank Group was invited to create the facility by the United States and Germany, given the Bank Group’s deep experience, track record, and strong learning and innovation agenda. The initiative received strong donor support Australia, Canada, China, Denmark, Germany, Japan, Netherlands, Norway, Saudi Arabia, South Korea, United Arab Emirates, United Kingdom, and the United States, enabling the Bank Group to take the facility from concept to Board endorsement within the year of the German G20 presidency.
One of the major constraints limiting female-led enterprises is access to financial services. Nearly 70 percent of women-owned SMEs in developing countries are either shut out by financial institutions or are unable to receive financial services on adequate terms to meet their needs.
Women Entrepreneurs Face Many Challenges
- It is estimated that women-owned entities represent just over 30 percent of formal, registered businesses worldwide.
- Yet, seventy percent of women-owned SMEs in developing countries are either shut out by financial institutions or are unable to receive financial services on adequate terms to meet their needs. This results in a nearly $300 billion annual credit deficit to formal women-owned SMEs.
- Lack of networks, knowledge, and links to high value markets further constrain female entrepreneurship.
- Moreover, unfavorable business and regulatory environments are among the barriers that still impede women entrepreneurs from accessing finance.
- The fact that many emerging markets financial institutions have yet to develop a sustainable strategy to address this significant market gap represents a missed opportunity and constrains private sector development
Source: WB. Read full information.
10 July, 2017
